lack thereof) of these import relief provisions and what I believe to be the failure of the executive branch of government to carry out the intent of Congress as reflected in the legislative history relating to the enactment of, and subsequent amendments to, these import relief provisions.

NO INCONSISTENCY IN AGRICULTURAL AND FOREIGN TRADE LAWS AS ENACTED BY CONGRESS

It has been suggested that there may be a conflict between our agricultural legislation and our foreign trade legislation, and your invitation requested comment on such possible conflict. This suggestion of possible conflict is doubtless founded upon what appears to be a conflict in the goals or objectives of such legislation.

Certain agricultural legislation has as its goal the protection of American farm producers through price support, marketing order, loan, purchase, direct payment to producers and other programs undertaken by the Department of Agriculture designed to maintain American farmers on a price, income and standard of living parity with other American producers-above comparable standards abroad. Certain foreign trade laws have as their goal the expansion of foreign trade-increased imports and increased exports. If both objectives were sought to be attained without any limitations or restrictions whatever, conflict would unquestionably arise. But Congress has not conferred such unlimited authority. The efforts to expand foreign trade are clearly and precisely limited by the requirement that increased imports shall not interfere with American agricultural programs or otherwise injure domestic producers, whether agricultural or industrial. So, the conflict, in my opinion, is not inherent in our laws relating to agriculture and foreign trade. I believe our legislation is entirely consistent. The seeming inconsistency arises solely out of the unwillingness of the executive branch of government, for many years, to fairly and effectively administer the import relief provisions of our foreign trade and agricultural laws in accordance with what seems to me the very clear intent of Congress.

While section 22 is the most important provision so far as agricultural producers, and our agricultural price support, marketing order and other programs are concerned, the American farmers are also vitally interested in the other import relief provisions in existing laws such as the escape-clause, which has a specific legislative provision for prompt emergency action in case of perishable agricultural commodities, the Anti-Dumping Act of 1921 and other enumerated above.

As pointed out above, I do not feel that there is any conflict between our agricultural legislation and our foreign trade legislation which has not been recognized and provided for by the Congress. The possibility of conflict in administering these two sets of laws enacted by Congress arises out of the fact that we have a long standing agricultural program prescribed by Congress which is designed to maintain the American farmers' prices and income on a parity with the very high standards of living achieved in the United States in all branches of industry. This agricultural legislation, most of which is mandatory and administered by the Secretary of Agriculture, tend to, and actually do, maintain American farm prices at above world price levels.

Whenever these argicultural programs are successful, which they usually are, in maintaining American agricultural prices above the world price levels for the same commodities, the program acts as an artificial and unnatural magnet drawing foreign agricultural commodities to the American market and out of their normal channels of trade where they would normally flow to consumers in their own home market or other foreign markets. These agricultural programs naturally tend to draw to the United States market agricultural commodities which we do not need and of which we usually have a surplus.

In its earliest legislation providing for such agricultural programs, the Congress recognized this factor and enacted section 22 of the Agricultural Adjustment Act of 1933 (as amended in 1935) which was carefully designed to limit imports of agricultural commodities when such programs tend to disrupt the normal channels of world trade in agricultural commodities and when such abnormal imports tend to interfere with the successful operation of the American farm programs.

On the other hand, we have a long established legislative foreign trade policy of encouraging the maximum beneficial expansion in foreign trade (both imports and exports), including agricultural commodities, so long as imports do

not cause or threaten serious injury to American producers or interfere with American legislative programs which tend artificially to maintain American prices above the world price levels for similar commodities. To me there seems to be no inconsistency whatsoever in this agricultural legislation and foreign trade legislation. Any seeming inconsistency arises out of the disparity in wage, price and living standards between the United States and some foreign countries. Possible conflicts have been recognized by Congress and provision made therefor in section 22 and other import relief provisions.

So long as the United States continues to have legislation such as minimum wage laws, agricultural or other price support programs (such as subsidies to shipping, inland transportation, mining and industries, etc.) designed to maintain and actually maintaining American wage and price standards above the comparable standards in one or more foreign countries producing the same products, there will, of necessity, be a tendency to artificially magnetize foreign products and services

(1) toward the United States market and

(2) out of their normal channels or world trade and

(3) away from other world markets and consumers where they are needed at the lower costs and prices at which they can be and are produced abroad. So long as we have this artificially and legislatively maintained disparity in wage standards, price standards and living standards, we must of necessity have laws which exercise some reasonable, but prompt and effective, control and limitation upon the abnormal flow of goods artificially attracted to the higherpriced United States market. Congress has recognized this necessity for some control over foreign trade and has provided therefor in section 22 and the other import relief provisions referred to above. These import relief provisions, particularly section 22, have been repeatedly amended and strengthened by Congress to make them more effective. As Congress has discovered substantive or procedural defects, it has acted promptly to correct them. The Congressional policy has been made abundantly clear, although frequently over the objection of the executive branch of government, which even now appears reluctant to carry out the directives and mandates of Congress.

The problem is simple and fundamental. So long as we do not have the completely free movement, across national borders, of all the factors of production, such as labor and capital, we just simply cannot have the completely free movement of commodities.

SEEMING CONFLICT ARISES OUT OF REFUSAL OF EXECUTIVE BRANCH TO PROPERLY ADMINISTER IMPORT RELIEF LAWS

Where our legislation gives some discretion to the executive branch of government (the President) as it does in most of our foreign trade legislation (particularly the relief provisions referred to above, with the exception of section 22) this gives occasion for a possible conflict between the administration of our agricultural (and other domestic legislation) and our foreign trade legislation. Since 1934, the executive branch of government has been strongly opposed to most of the domestic industry import relief provisions written into our agricultural and foreign trade legislation by the Congress. The Congress has adopted them, and their strengthening amendments, over the objection of the administration. Consequently, wherever the President and the executive branch (which means the State Department in the final analysis) has any discretion in administering these import relief provisions, there arises a seeming conflict between the two sets of laws.

However, this conflict is solely one of administration and enforcement rather than a conflict inherent in the legislation itself. This conflict in the administration of these two sets of laws becomes most apparent through and is most publicized by our own State Department which originally opposed and now openly criticizes any effective administration of these laws of Congress, such as section 22 and the escape clause. Upon careful and searching investigation, the subcommittee will find that the State Department and our representatives abroad have actually encouraged foreign countries to criticize any effective administration of these import relief provisions and to claim that they are inconsistent with what they conceive to be our free trade program as announced to foreign countries by the State Department. The State Department has grossly misrepresented to foreign countries our import relief laws and the power of modification it claims to have. Then, once a foreign country has stated a criticism of an import

limitation imposed by the President under one of these laws, or has denounced the law itself or the Congress for enacting it, the State Dapartment repeats the foreign criticism with approval. The State Department uses such induced foreign criticism as propaganda and lobbying material to get the Congress to repeal or modify the law, or to convince the President that he should not invoke the import relief law in accordance with the congressional intent.

The State Department has not properly explained our import relief provisions to foreign countries or the reasons why Congress adopted them. On the contrary, the State Department has misrepresented the intent of Congress in enacting such laws. The section 22 waiver which the State Department recently asked of GATT for the temporary permission to operate our section 22 constitutes a most alarming example of this willingness on the part of the executive branch to belittle and undermine our laws and to use foreign critics to pressure the Congress or the President into modifying or nullifying our import relief laws or to make them subservient to the State Department's executive international agreements, such as GATT. I discussed this section 22 waiver which our State Department improperly sought from GATT, in more detail in my statement before the Ways and Means Committee earlier this year during its hearings on the Organization for Trade Cooperation (OTC)—see pages 198-216 of printed hearings on H. R. 5550.

The clarity and, I believe, complete consistency of our domestic agricultural and foreign trade legislation as written by Congress, with the seeming conflict arising only out of the Executive Branch's unwillingness to properly administer such laws, is very well illustrated by the history of section 22 and the Administration's attempt to discredit, modify or nullify it through executive action and through agreement with foreign nations in GATT-an attempt to discredit and nullify section 22 by improper and unauthorized executive foreign agreements.

LEGISLATIVE HISTORY OF SECTION 22 AND ITS ADMINISTRATION BY THE

EXECUTIVE BRANCH

I will attempt to review briefly the legislative history of section 22 as origi nally enacted and the several clarifying and strengthening amendments thereto. I will also discuss the manner in which the Executive Branch of Government has consistently refused to effectively administer section 22 and the resulting circumvention and nullification of the intent of Congress at every turn.

The reasons for and the purposes and intent of section 22 cannot be better stated than they were by Secretary of Agriculture Benson in his statement before the Ways and Means Committee in April of 1953 in connection with the Committee's consideration of H. R. 4294, the Trade Agreements Extension Act of 1953. The following is quoted from Secretary Benson's statement appearing at pages 726-728 of the printed record of such hearings.

"I recently recommended to the Senate and the House Agricultural Committees that the Reciprocal Trade Agreements Act be extended.

"At the same time I indicated that import controls should be provided for those United States agricultural products which were under price support, and recommended that section 22 of the Agricultural Adjustment Act of 1933 be strengthened so as to make this possible. Let me review for you the conditions that made these recommendations advisable.

"We, in Agriculture have in operation, as a consequence of congressional aetion, various price-support programs. Many of the commodities included in these price support and marketing-order programs are subject to substantial import competition. In many cases the price-support level is substantially above the world market price, even after allowance for the customs duties assessed against imports. When that happens, imports are attracted to this country from all over the world, including areas whose products would nor mally be exported in whole or in part to other countries where they may be badly needed. But the price-support level in this country acts like a powerful magnet to draw these commodities out of their normal flow in international trade. When we seek to limit the effect of this influence, we are simply seeking to diminish or avoid the distortion of trade by the stimulus of an artificial influence, such as a price-support program.

"I am sure the Congress would not enact a statute making mandatory the support of the world price of agricultural commodities at 90 percent of American parity. Yet that is what the present mandatory supports mean if we do not have a readily available and effective method of controlling imports of those com

modities or products whose prices are maintained here above world levels by price support or marketing-order programs. Our price-support activities, already costly, would become much more expensive.

"In recognition of the fact that a stimulation of imports can impose an intolerable burden on a price-support program, the Congress enacted section 22 of the Agricultural Adjustment Act. This section provides for the imposition of import quotas or import fees whenever imports of any agricultural commodity or product thereof render or tend to render ineffective or materially interfere with any price support or marketing order (or certain other) programs. This is permanent legislation.

"Although section 22 was originally enacted in 1935, it was very little used. It calls for investigation by the Tariff Commission after recommendation by the Secretary of Agriculture. Only 5 such investigations have been instituted in the past 17 years. Experience has shown that these investigations are usually long drawn out and this procedure, has proved to be wholly ineffective to meet the problem.

"Because of the failure of the executive branch to use section 22 in such a manner as to achieve the objectives of its enactment, Congress enacted section 104 of the Defense Production Act. This section applies only to certain fats and oils, butter, cheese, and other dairy products, peanuts and rice and rice products.

"It requires that imports of such commodities shall be limited to such quantities as the Secretary of Agriculture finds will not (1) impair or reduce domestic production below current levels or such higher levels as deemed desirable; (2) interfere with orderly domestic storing and marketing; or (3) result in an unnecessary burden or expenditure under a price-support program.

"The control of imports under section 104 is prompt and effective. But it has been subjected to severe criticism on the ground that the procedure is arbitrary in character, and it has been the source of much friction in international relations. It requires the imposition of more drastic import restrictions than would be required simply to protect our price-support programs.

"We feel strongly that Congress intended section 22 to be used, and used effectively whenever necessary to protect price-support and other programs. The statutory history clearly so indicates. Section 22 can be made an effective instrument by improved administrative procedures and by supplementing it with authority, in an emergency, to impose the quotas or import fees within the limits specified by the section, on an interim basis pending decision by the Tariff Commission and action by the President. So strengthened, section 22 would assure the protection of the Department's price-support and other programs against interference or nullification by the distortions in international trade which such programs are likely to create.

"Furthermore, under this procedure the import restrictions which are necessary to protect our price-support programs would be subject to deliberations in which all parties could be heard rather than being imposed arbitrarily as is now the case. This would be in harmony with the policies embodied in the reciprocal trade agreements.

"The Tariff Commission, at the request of the President, began hearings on Monday of this week in an effort to expedite action on agricultural commodities now under price support.

"With the strengthening of section 22 there will be no need for an extension of section 104. The strengthening of section 22 can be accomplished by expedited administrative action and by a separate legislative action. I point this out merely to clarify the fact that extension of the trade agreements for a year, pursuant to the President's request, need not impair our price-support operations nor our protection of them.

"I wish to emphasize that the limitation of imports for commodities under price support is made necessary by our price-support laws."

Similar statements were made by Secretary Benson, earlier in 1953, before both the House and Senate Committees on Agriculture.

The read congressional objective and intent behind the enactment of section 22, and its various amendments, as is so ably stated by Secretary of Agriculture Benson above, have never changed materially since its original enactment on August 24, 1935 (49 Stat. 750), which added section 22 to the original Agricultural Adjustment Act of 1933. However, since the original enactment of section 22 in 1935, the Congress has repeatedly (in 1936, 1940, 1948, 1950, 1951,

and in 1953) broadened and strengthened its substantive and procedural provisions. Each time a loophole of substance or procedure has developed, the Congress has moved promptly to plug it up and make it a more effective limitation upon imports. The Congress has attempted to correct weaknesses as they developed with changing conditions in our agricultural programs and has tried to avoid any circumvention of section 22's provisions through procedural devices employed by the executive branch.

A brief review of the legislative history behind these various strengthening amendments to section 22 will serve to emphasize the clear and mandatory intent of Congress that section 22 should and must be used promptly and effectively to limit imports whenever the Department of Agriculture has in operation any farm program which imports might tend to interfere with. It is important to keep in mind that section 22 has always been mandatory upon the President since its inception in 1935. The pertinent language directs and mandates that: "If*** the President finds the existence of such facts, he shall by proclamation impose such fees * * * or such quantitative limitations * * Originally section 22 provided for import protection only for "an adjustment program *** under this title," referring to a portion of the Agricultural Adjustment Act of 1933. In the first year after its original enactment in 1935, Congress recognized the necessity of broadening the protection of section 22 to other agricultural programs. In an amendment of February 29, 1936 (49 Stat. 1148), the Congress broadened the programs entitled to section 22 protection to include programs operated under the Soil Conservation and Domestic Allotment Act.

On June 3, 1937, Congress reaffirmed this policy and reenacted section 22 as a part of the Agricultural Marketing Agreement Act of 1937 (50 Stat. 246) without any modification.

On January 25, 1940 (54 Stat. 17), section 22 was again broadened and strengthened to provide protection for agricultural programs initiated and administered by the Secretary of Agriculture under section 32 of the Agricultural Adjustment Act of 1933, which section allocates 30 percent of the gross receipts from import duties to assist agricultural producers through purchases, direct payments to producers and other programs designed to expand consump tion of agricultural commodities and to encourage and develop exports and other new markets for American agricultural commodities. Up to this point, section 22 had applied only after excessive imports had actually entered the United States and had actually interfered with an agricultural program. However, Congress came to recognize that we should not wait until the imports had actually entered and interfered with a program, but should anticipate such interference and impose section 22 limitations in advance of such interfering imports. In this same 1940 act, to accomplish this purpose, the Congress further amended section 22 by adding the italicized words in the provision now reading "are being or are practically certain to be imported into the United States." Another important amendment of this 1940 act was to authorize in subsection (b), the imposition of additional import fees as well as quotas and to make it clear that the quantitative restriction applied to "entries for consumption" and not to the more indefinite terms "which may be imported" as previously used. Also the base period was changed slightly and the language clarified.

Thus, this 1940 amendment again broadened the agricultural programs intended to be protected by section 22, but the more important provision was that directing that the Secretary of Agriculture and the President should anticipate excessive imports and impose a limitation under section 22 prior to any actual interference with an agricultural program. Both the House and Senate Committees on Agriculture, in explaining the necessity for this amendment to seetion 22 (contained in H. R. 7171, 76th Cong.), had the following to say (H. Rept. 1166 and S. Rept. 1043):

"One important technical shortcoming of the present provisions of section 22 is that a domestic farm program cannot be protected against foreign importations until such importations have actually arisen and have adversely affected the program. In other words, at least one of the chickens must be stolen before the coop may be locked. This is a wholly anomalous situation because in some instances it is known to a point of overwhelming certainty that a particular farm program will be ineffective in the absence of some protection against increased foreign importations. Consequently, the bill provides that restrictions against foreign importations may be imposed under the provisions of section 22