under the common agricultural policy. And this $5381 was just enough to encourage EC purchasers of wheat to buy primarily from EC suppliers, leaving U.S. suppliers as a secondary source.

I am aware that agricultural prices have since risen, so that now world prices are above EC supported prices. Thus it could be argued that variablelevies are no longer a problem, and that if the U.S. were really concerned about promoting agricultural exports it would not have imposed controls last

summer.

Notwithstanding these statements, it should be recognized that as supplies increase, prices will drop. And if we were to have a bumper crop in the next year or two prices could drop significantly-so much so that our farmers would again be confronted with the issue of variable levies. The Agriculture Department stated in 1972 that in the 10 years since inauguration of the Common Agricultural Policy, EC variable import levies have held the rise in exports of affected U.S. commodities to the EC, to 23 per cent-compared with a 94 percent gain for commodities not subject to the levies. Put another way, the U.S. share of the EC agricultural market has decreased from 12% to 9% during the period from 1962 to 1972. With the enlargement of the EC, the application of the Common Agricultural Policy could place even further constraints on our agricultural exports.

My second example is in the area of manufactured products. Caterpillar Tractor Co. in our area has stated that trade agreements between the EC and the five non-acceding EFTA countries will result in an eventual reduction to zero of duly rates on products similar to Caterpillar's. Meanwhile, the duty rates on Caterpillar's products exported to EFTA and EC countries will remain the same. Thus, according to Caterpillar-based on its 1972 exports of $24.3 million to the EC for which comparable equipment is manufactured by EFTA competition-Caterpillar will incur a weighted average 10.8 per cent duty disadvantage. Similarly, based on its 1972 exports of $14.5 million to EFTA, for which comparable equipment is manufactured by EC competition, Caterpillar will incur a weighted average 5.9 per cent duty disadvantage in that market. From this it seems reasonable to conclude that other U.S. manufacturers will suffer similar duty disadvantages.

The point in both cases, Mr. Chairman, and Members of the Committee, is that we must have a trade law which provides our negotiators the authority to work toward removal of these harmful practices and the establishment of an equitable trading system.

With regard to the extension of preferences, I am not opposed to providing generalized preferences to all eligible nations. But such preferences should be granted only on a non-discriminatory basis-not on the basis of some special historical relationship such as that of a former colony. Moreover, developing countries should not be permitted to extend reverse preferences to certain industralized nations and not others. But such practices not only hurt U.S. suppliers but are inconsistent with the provisions of GATT. I am pleased that the proposed legislation does not permit the extension of a generalized preference to any developing country which affords preferential treatment to the products of a developed country and not the United States. And I would hope that our negotiators will work towards the removal of all but generalized preferences, extended on a non-discriminatory basis to eligible developing countries.

THE AUTHORITY TO EXTEND MOST FAVORED NATION STATUS

To get the barriers removed abroad, we must be willing to reciprocate and remove our own barriers. In particular, we must deal with the question of equal tariff treatment for non-market economices. I firmly support the goal of human rights for all individuals, including the right of freedom of emigration. Moreover I believe this to be a legitimate goal for the Government of the U.S. to pursue. But I do not believe that requiring free emigration as a condition of equal tariff treatment or the extension of credits will in fact ensure that freedom. Such action could, in fact, have quite the opposite effect. I believe there are more effective means of accomplishing this very important goal. It would seem that such a complex issue could be better handled through a continued broad range of diplomatic efforts.

Moreover, such conditions could have an adverse effect on U.S. exports. It seems unlikely that the governments of non-market economies could contine to

purchase U.S. goods in significant amounts if they were not assured, at the minimum, equal access to U.S. markets and a reasonable balance of trade. In addition, the withholding of equal tariff treatment would most likely benefit other industrialized nations, particularly the EC and Japan, by allowing them to improve their already significant penetration of these markets. As this penetration continued, it would become increasingly difficult for U.S. suppliers to break into these markets, for it is likely that the USSR would become more and more accustomed to acceptable European and Japanese alternatives.

THE EXTENSION OF U.S. EXPORT-IMPORT BANK CREDIT

The last point I would like to touch upon today deals with the activities of the Export-Import Bank, and in particular, Eximbank credits to non-market economies. Eximbank's enabling legislation emphasizes the need to promote exports in order to contribute to the economic well-being of our nation. This language is couched in economic and commercial terms, with only occasional references to political considerations. In this respect, the Eximbank is obviously quite different from AID. Eximbank is used to promote and facilitate exports and thereby contribute to our economic well-being, while AID is a bilateral assistance program which, among other things, serves as a means to achieve our foreign policy objectives. I believe both activities perform a vital function, but I also believe the two should be kept quite separate-separate in the sense that I think we should avoid, whenever possible, using Eximbank as an extension of our foreign policy objectives. While I recognize the difficulty of adopting this approach in all situations, I nevertheless believe the primary criteria employed by Eximbank in reviewing credit applications should be economic and commercial.

While the extension of an Eximbank credit may be regarded as a form of assistance to the borrower, it also enables the borrower to purchase products from a U.S. supplier. Moreover now that Eximbank's direct lending rate has been increased to a fixed 7 per cent, it would be difficult to argue that such credits were being extended on a concessional basis (March 8 rates for 3-5 year Government securities were 7.05%). We must remember that every borrower from Eximbank pays the same fixed 7 percent. Thus it would appear that in the long run the benefit flows to the U.S. in general, and the U.S. supplier in particular. Moreover, the extension of such credit could lead to the development of a solid, pragmatic business relationship which in turn could help pave the way toward improved political relations.

Besides assisting the U.S. supplier, the extension of credits to the USSR, in instances such as financing the sale of energy-related goods and services, could result in other benefits. In particular it could help assure that the output of these projects would be shipped to the U.S. This supplement to our own energy sources could serve to provide some balance in our dependence on foreign supplies of energy.

In closing, let me stress again that I believe the United States Government should actively pursue the goal of freedom of emigration for all people. But I feel that this goal can be best achieved through continued bilateral diplomatic contact with the governments of the non-market economies. Indeed, Mr. Chairman, I believe much progress has been made to date in this entire area through diplomatic initiative. And I have no reason to believe that such progress should not continue. Thank you.

[From Newsweek Magazine, Apr. 8, 1974]

MY TURN: THE DISSENTERS SOLZHENITSYN LEFT BEHIND

(By Herbert Gold)

Recently I returned to the Soviet Union to visit the dissenters Solzhenitsyn left behind. On my last trip, nine years ago, almost everyone paid the police the extreme deference of fear. Now a curious alteration has taken place. Whole groups-intellectuals, nationalists, religious people of various convictions, Jews, even mere admirers of jazz or contemporary films or the clothes that go with more hair-seemed almost blithe about the cops tailing them and me. A blitheness of desperation; nothing more to lose.

With a scholar of Eastern religions, I waved for a cab during the rush hour in Moscow, and of course one pulled up right away, ignoring everyone else. “We can get cabs," he said. "It's a convenience." In Leningrad, Valery Panov, the dancer, put on a record of the music from "Coppelia" to confuse the bug as we talked. “And also," he said, grinning, "because it's so boring for the KGB to hear again my same old story." In Moscow, a banned painter, expelled from his union for "violation of the principles of socialist realism," echoed the words of a physicist in Kiev: “At last, there are some free people in the Soviet Union. We don't care any more."

Hundreds of these free people came to an all-day party for the writer Maksimov, sent abroad a few days after Solzhenitsyn. It was an honor roll of the blacklisted of Moscow. A well-known critic took me for a walk in the frosty weather. He spoke of an American friend who had once offered a gift of money. "I refused," he said. He was very embarrassed. "I was working. My wife had a good job. Now my books can't be published. My wife has no more job. Now please tell my friend we will accept the gift." We walked on, and this stalwart man of middle years, a grandfather, a member of the party since the war, was weeping with shame and rage. "Sometimes we have no money for eating!"

General Grigorenko and others are in insane asylums for speaking out about Soviet power lumbering against Hungary, Czechoslovakia, Israel, artists, thinkers. For meeting. For passing out statements. For signing petitions. To disagree with the regime is madness-the average Soviet psychiatrist will certify a man for defending human rights. PARTY AND PEOPLE ARE ONE, as the billboards say. A poet, recently returned deaf from Siberia, said to me: "Make no mistake about it. Soviet prisons are not nice soft ones like yours."

For the Jews, it is not the Germany of the death camps. It is more like the Germany of 1932-limitations on jobs, exclusions from schools. isolation from culture and tradition. The regime seems uncertain about whether to milk the Jews like cows or use them as scapegoats. Scapegoats are needed. The morose drunkenness visible every night speaks for a general repressed rage amid the triumphs of still another five-year plan. For those Jews who announce their desire to emigrate to Israel-and without the right of emigration, men are serfs-it is Germany, circa 1936. Joblessness, ostracism, police harassment, random frameups and abuse. Engineers and mathematicians work as "lift boys," to use the quaint English of one of them, because otherwise they can be charged with the crime of parasitism. I met a lift boy who has invitations to teach at Cambridge, Harvard and Berkeley. Another distinguished scientist was called in for questioning four months ago. After his visit to the police, he is still unable to sit down because of acid burns on his thighs and genitals.

MAKE LOVE, NOT WAR

All right, what does it have to do with us? We Americans have our own problems, don't we? Isn't it foolish for a people with stains on its own flag to meddle in the internal affairs of a great power that seeks to unfurl the banner of detente? The wise old cold warriors now want to do business together-our money and their natural gas, our industrial technique and their unexplored resources, our markets and their markets--and isn't commerce between peoples the way to peaceful coexistence?

The courageous physicist Andrei Sakharov warns that the matter isn't so simple. His argument is that selling the Soviet Union our computers and industrial skills in exchange for raw materials will doom any hope of easing the iron Soviet regime. The faceless bureaucrats will no longer need their own "effete snobs." They can buy the technical ingenuity abroad; they can crack down harder at home. The businessman's and banker's detente, he says, will snuff out the light still stubbornly glimmering among the immensely gifted, stifled people of the Soviet Union.

And with this abandonment of hope for those who treasure freedom will come a practical danger for America, too. Who will caution Soviet power against the old power games? When our bankers put our money into loans for natural-gas installations in Siberia, who will protect the supply when Pravda discovers American iniquity some place in the worid? If our little friend Saudi Arabia can cut off oil to punish us, why shouldn't our brand new big buddy. the U.S.S.R., act enthusiastically upon some other occasion to discipline us?

30-229-74-pt. 4-37

I walked on Gorky Street in Moscow with a mathematician who presented me with some simple arithmetic. "You give two good and get one weak." "I don't understand."

"You give money for investment. Then you give tools, machinery, skills. In return, you get a promise of goods. Two strong, one weak."

He was suggesting that the bargain is not a smart one. Sakharov says something that touches more deeply: the bargain is a cruel one.

DEAD SOULS

"You have heard of brain drain?" a fired professor asked me in Kiev. We were standing in a desecrated, bulldozed Jewish cemetery not far from the pits of Babi Yar. There were smashed columns, gaping holes filled with brackish ice where coffins had been. My friend's daughter was weeping. Her greatgrandparents had been buried here. We tramped about in the slush and mud. There was no reason to destroy this relic of the ancient Jewish presence in Kiev, but nevertheless one night it had been done. "The problem here is not brain drain," my friend said. "That's not why there are so many troubles. The problem is soul drain."

Herbert Gold's most recent book is "My Last Two Thousand Years," published by Random House.

Senator MONDALE. Dr. Louis Krauthoff and Mrs. Doreen Brown.

STATEMENTS OF DOREEN L. BROWN, CHAIRMAN, CONSUMER EDUCATION COUNCIL ON WORLD TRADE AND LOUIS KRAUTHOFF, CHAIRMAN, ADVISORY COMMITTEE, CONSUMER EDUCATION COUNCIL ON WORLD TRADE

Statement of Doreen L. Brown

Mrs. BROWN. I am Doreen Brown, chairman of the Consumer Education Council on World Trade. Dr. Krauthoff is chairman of our advisory committee. He has a few words to say after my statement and mine will be very brief.

We are making this statement on behalf of a number of national organizations, participating members of the Consumer Education Council on World Trade, who are linked by a common interest in U.S. trade policy and the welfare of the consumer. The list of organizations joining in this statement is attached. I serve as chairwoman of this council on a volunteer basis, as do all of our officers and board members.

The Consumer Education Council on World Trade was established almost 2 years ago, through the efforts of 22 national public-interest and consumer-oriented organizations, who felt that the American consumer was neither adequately informed nor adequately represented on trade issues. There had never been sufficient debate on the implications for the consumer inherent in U.S. trade policy, and individual organizations who attempted to speak on behalf of the citizenry were being overshadowed by the very vocal vested interest groups.

Our member organizations are in unanimous agreement that every consumer in the U.S. has a major stake in international trade; that this is an issue that directly affects their economic well-being, as well as their freedom of choice in the marketplace; that protectionism is against their interest and that it therefore behooves the American consumers to become vigorous advocates of a freer trade policy.

We are particularly concerned because the low income consumers generally suffer most, since they are most sensitive to any increase in

prices, and since low-priced goods from abroad are normally the primary target of U.S. import restrictions. These concerns have increased considerably, both in intensity and in validity, since the inception of this council, as we all realize that the brunt of the consequences of an inflationary period in our economic history is borne by those least able to compensate.

Although we favor strongly the prompt passage of dependable and effective trade legislation and recognize the importance of such legislation to meaningful GATT negotiations, we are deeply troubled that the pending legislation does not address itself sufficiently to the specific interests of the consumers.

We presented a statement to the House Ways and Means Committee urging additional consideration for the consumer and we were gratified to see as part of the bill passed by the House of Representatives, the inclusion of consumer representatives on the Advisory Committee for Trade Negotiations which will work with the special representative for trade negotiations. We do not feel, however, that this is sufficient to protect the consumer and would urge that this committee seriously consider the following recommendation:

That whenever there is a matter of adjudications, negotiations, determinations or interpretations, or the creation of advisory bodies to the President, the Tariff Commission, the White House Council on Economic Policy, the GATT negotiating authorities or any other entity concerned with the formulation and implementation of U.S. trade policy, there should be included on these bodies representatives of consumer interests. Such representatives would be responsible for voicing and protecting consumer interests only, as distinguished from the other self interests of any particular segment of the population. We would also like to make an additional recommendation which has to do with the fact that in U.S. trade legislation, as in this particular bill, the President has always been historically obligated to consider the interests of various segments of the economy before taking any remedial or protective action-industry, the worker, agriculture, and we feel that there should be spelled out in the legislation that whenever he does take into consideration, before taking action, the welfare of industry, labor and agricultural, that he also be mandated to take into consideration the interests of the American

consumer.

In this way consumer welfare will have been given equal priority with that of the other economic segments of the United States. We are all aware that all American citizens are American consumers, that the good of the American consumer is the good of the nation, both economically and socially, and we feel very strongly that their interests should be considered at all points and levels in the regulation of trade policy.

Dr. Krauthoff has a few bright thoughts to add.

Statement of Louis Krauthoff

Mr. KRAUTHOFF. I am not so sure. I want to talk with you more about some dialogue with some other witnesses than the things that are in my statement.