26208 EXTENSIONS OF REMARKS October 1, 1987 EXTENSIONS OF REMARKS THE FINANCIAL SERVICES services for the subsidiaries described in company will not be in compliance with sec HOLDING COMPANY ACT subsections 2(b) and 2(c) of this section; tions 23A and 23B of the Federal Reserve (e) has insulated any bank or banks con Act <12 U.S.C. 371
e This "bullet" symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor. Matter set in this typeface indicates words inserted or appended, rather than spoken, by a Member of the House on the floor. October 1, 1987 EXTENSIONS OF REMARKS 26209 those subsections as if the certified financial AMENDMENTS TO THE BANK HOLD!NG COMPANY in making or procuring loans on real estate services holding company were an insured ACT and also including acting as broker or agent bank. SEc. 8. Section 2(a)(5) of the Bank for the sale or purchase of real estate under
91-059 0-89-10 (Pt. 19) 26230 EXTENSIONS OF REMARKS October 1, 1987 flag. Officials acknowledge that the restric and the administration have thus far been As is evidenced by the 525 jobs that Bur tion on computer exports to apartheid-en slow to examine the economic ramifications of lington Industries lost fighting off a foreign forcing agencies is largely unenforceable this development. due to opportunities for evasion. The Ad takeover bid this summer, hostile takeovers ministration is unwilling to assure Congress Foreign ownership in the United States rose seldom leave local communities unscathed. A that the intelligence community is not en to a remarkable $1.33 trillion in 1986, up 25 successful takeover often severs the ties be gaging in military collaboration with South percent from the previous year. All indications tween a company and the community. Unfor Africa, and the U.S. Trade Representative are that 1987 has witnessed an even more tunately, corporate commitment to a local has formally disavowed its responsibility dramatic increase. By contrast, in a complete community is often lost after a takeover, espe under the President's Executive Order to reversal of the situation only a decade ago, cially if the new corporate headquarters is implement provisions penalizing foreign U.S. holdings abroad now total only $1.07 tril overseas. countries that take commercial advantage lion. of U.S. sanctions. Obviously, this situation cries out for an ex Credible black leaders and organizations An additional worrisome aspect of this issue panded Federal role in the regulation of for continue to call for strengthened Western is the giant increase in the number of foreign eign takeovers. In the ongoing and welcome sanctions. Last July, Archbishop Tutu reaf takeovers of American corporations. The debate currently taking place in Congress re firmed his support of "sanctions and disin annual number of foreign takeovers increased garding takeover reform legislation, the unique vestment" as "effective, non-violent action" eightfold from 1976 to 1986. While foreign characteristics of foreign involvement in this to enable blacks to obtain political power. takeover activity currently accounts for only 5 problem have been virtually ignored. Previously he had condemned the resched to 10 percent of all U.S. merger transactions, Consequently, in recognition of the dangers uling of South Africa's debt by Western given the current frenzy of foreign purchasing, banks without guarantees that apartheid inherent in the rapid growth of foreign involve would be eliminated. In July, COSATU, the that percentage can be expected to grow dra ment in the American economy, I am introduc largest black trade union federation in the matically. ing legislation today to establish a broad country, with over 712,000 paid and a mil What does this mean for the American based analysis and Federal response to this lion claimed members, adopted in its nation economy? No one can be certain, but there problem. The Domestic Industry Safeguard al convention resolutions calling for "com are enough warning signs evident for Con Act will assure that local communities receive prehensive and mandatory sanctions" and gress to begin serious consideration of this some Federal protection from the conse disinvestment. Earlier the second largest issue. Lawrence Brainard, chief international federation, NACTO, comprising over 240,000 quences of unfriendly foreign takeovers. economist for Manhattan's Bankers Trust In addition to more stringent reporting re paid and 420,000 claimed members also warns, "By the end of this century, the United called for "full sanctions" and withdrawal of quirements and asset sale prohibitions for for foreign investment. The Reverend Alan States may have the most modern manufac eign-based acquirers, the Domestic Industry Boesak, a patron of the United Democratic turing sector in the World, but it won't own it." Safeguard Act mandates more comprehensive Front, the largest anti-apartheid organiza While some of the foreign investment in the study of this issue at the Federal level. The tion in South Africa with over 700 affiliates United States has been positive, by their very effects on both our national and local econo representing about 3 million people, recent nature, hostile foreign takeover attempts in mies are simply too significant to leave unex ly complained, "In spite of what South crease the likelihood of corporate abandon Africa has done over the past few years, the plored. ment due to foreign ownership's inherent lack I would like to encourage my colleagues to international community has not been able of commitment to American communities. to impose meaningful sanctions to make the consider the threat posed their communities government sit up and take note of the peo One of the ironies of the foreign takeover by hostile foreign takeovers, and join me as a ple's frustrations". issue is that, for U.S. tax purposes, foreign cosponsor of the Domestic Industry Safeguard The President's own Advisory Committee corporations are allowed to fully deduct the Act. on South Africa, Co-Chaired by former IBM debt service financing of their takeover at the Chairman Frank Cary and Former Secre same time they are threatening an American tary of Transportation William Coleman, corporation. With the current need for deficit "PHOENIX EXPANSION" recommended in January that, "If Pretoria reduction, the effect on the American Treas remains intransigent, the international com ury of this very friendly treatment of foreign munity would have to address the adoption HON. CHRISTOPHER H. SMITH of additional diplomatic and economic steps. corporate raiders deserves additional scrutiny OF NEW JERSEY These might include a comprehensive multi from Congress. IN THE HOUSE OF REPRESENTATIVES lateral trade embargo and consideration of Increasingly, healthy American corporations ways to establish effective international are becoming takeover targets of both domes Thursday, October 1, 1987 sanctions on newly mined South African tic and foreign interests, and the results are Mr. SMITH of New Jersey. Mr. Speaker, Oc gold". not often welcome news for the companies tober 1, 1987, marks an event of great signifi Reverend Leon Sullivan called, last June, and communities involved. This trend has cance to the American people. After years of for the withdrawal of U.S. companies and a forced the development of new, and often economic stagflation, we are now enjoying the total trade embargo until statutory apart heid is ended and an agreement has been harmful, tactics by both parties involved in so-called Phoenix Expansion. Fifty-nine con negotiated with authentic and representa takeover attempts. secutive months of economic growth and re tive black leaders for equal political rights; One of the most serious of the negative ef covery are truly a cause for national celebra 23 states, 14 countries and 175 cities have fects brought about by the rash of hostile tion. This is the longest consecutive peace taken some sort of sanctions against apart takeovers is the damage done to the workers time expansion since the Second World War. heid. As a result, an estimated $19.6 billion and communities of the targeted companies. However, we cannot allow this recovery to has been redirected away from companies All too often, workers lose their jobs and com falter. Congress is duty bound to the citizens it that do business with South Africa. munities lose their plants as a result of the represents to continue the policies which have cost cutting required by both successful and given life to this remarkable economic expan THE DOMESTIC INDUSTRY unsuccessful takeover attempts. sion. SAFEGUARD ACT Current law allows those leading a takeover The facts which demonstrate our economic attempt to borrow up to 100 percent of the growth speak for themselves: HON. STEVE GUNDERSON purchase price for the target corporation. This The gross national product-in constant OF WISCONSIN practice almost inevitably leads to the practice dollars, adjusted for inflation-has increased IN THE HOUSE OF REPRESENTATIVES of buy, strip, and sell. After successfully gain an average of 3.9 percent from 1983 to 1987. ing the controlling shares of the takeover This exceeds the growth of West Germany Thursday, October 1, 1987 target, many buyers find themselves so com and Japan, and our own GNP increases from Mr. GUNDERSON. Mr. Speaker, one of the pletely leveraged that they have no other 1977-82. United States most disturbing trends in recent option but to sell off their new company's Inflation, which was 12.4 percent in 1980, is years has been the rapid growth in the foreign assets to pay their banker. This forced re now down to 3.8 percent. takeover of American industry. Although there structuring has led to the loss of thousands of Interest rates, for 3-month Treasury bills, have been a number of recent press accounts jobs, and the abandonment of many previous have fallen from 10.69 percent in 1982 to 6 of this foreign buying spree, both Congress ly productive factory operations. percent in August 1987. October 1, 1987 EXTENSIONS OF REMARKS 26231 Unemployement levels have dropped from For the third year in a row, our Nation benefits, housing assistance, and education 9.5 percent in 1982 to only 5.9 percent in July begins a new fiscal year without any of the 13 programs. This legislation is also likely to in 1987. regular appropriations bills signed into law. elude more than $12 billion in taxes and will Nearly 14 million new jobs have been cre Our Government again is operating on a tern- provide for hundreds of technical corrections ated since 1982. porary continuing resolution-a resolution that to the Tax Reform Act of 1986. Per capita income was $11 ,670 in 1986, up symbolizes our inability to make the difficult Reconciliation could, in addition, revamp our 14.4 percent since 1982. budgetary decisions necessary to get our Na- Nation's welfare programs, reauthorize our Americans living under the poverty level are tion's economic house in order. Nation's housing and agriculture programs, at the lowest percentage since 1980. You have to go back 11 years, to 1976, to and impose new international trade sanctions. These figures are clearly good news for find the last time Congress completed its work As in years past, the House will consider this America. on all 13 appropriations bills and had them legislation without having the time to review Advances have been made for both the rich signed into law. Since that time, continuing the thousands of pages such a bill would and poor. The dramatic gains in the stock resolutions have become the rule rather than entail, without the opportunity to offer amend market have helped investors and corpora the exception with an average of eight appro- ments, under rules providing for limited tions. At the same time, new jobs and more priations bills a year being lumped into one debate, and with the privilege of casting one favorable tax treatment have lifted the poor catch-all spending measure. Last year, we yea to nay vote on the entire package. out of poverty and into the mainstream of so failed to have any of the 13 appropriations Congress has the constitutional responsibil ciety. But by far, the greatest gains have been bills enacted into law. Our Nation's Federal ity to make Federal budget and spending deci made by the middle-class family. Each of the Government operated for an entire fiscal year sions, but the last few years have shown that facts listed above translate into prosperity for under a continuing resolution-a resolution for we are unable to discharge these responsibil the workers of this country. which Members of the House had the oppor- ities in a timely manner. Clearly the time has A good deal of the credit for this economic tunity to cast just one yea or nay vote. come for the leadership and Members of this success story must go to our President. The Worse still is our record of getting our ap- body to consider revising the procedures platform President Reagan ran upon included propriations work done on time. Twelve of the under which we carryout our budgetary re the policies which have helped achieve these thirteen appropriations bills were enacted into sponsibilities. results. He has supported the overall reduc law on time in 1976. Since then, Congress Gimmicks such as Gramm-Rudman-Hol tion in tax rates which has provided capital for has started the last 11 fiscal years with only lings, which failed once but are being trooped investment in private-sector businesses. The an average of 2.5 appropriations bills in place. out again, won't solve the problem. What is President has consistently opposed unneces As a member of the Appropriations Commit- required by this Congress is a commitment to sary increases in Government spending tee, this course of events is particularly frus- make the difficult decisions that establish Fed through the use of his veto power. And finally, trating to me. The members of our committee eral spending priorities and to cast the difficult he has followed a sound monetary policy spend months intensely reviewing the admin- votes to carryout these decisions. which has reduced the high interest rates. istration's budget requests, holding hundreds What is also needed is a revamping of our Unfortunately, there are some who will try to of hearings annually with department and budget process. 1 have advocated over the belittle the economic figures for the past 59 public witnesses. We scrutinize agency budg- years that we abolish the Budget Committees, months. Others will try to take the credit away ets line by line and in our respective subcom- and the unnecessary added layer of bureauc from the President and the policies he has en mittees make a number of difficult decisions racy associated with them, that we move dorsed by twisting the facts and figures to about program funding levels. In the Defense toward a 2-year budget cycle, which would support their claims. Those who once de Appropriations Committee, this requires us to . give Congress more time to enact appropria nounced "Reaganomics" now demand higher review and make decisions about more than tions and authorization legislation, and that we taxes and fatter Federal budgets, without 10,000 separate line items. set aside a specified period of time during reading the facts. We take great care in drafting these appro- each budget cycle for the Congress to consid But I think we agree that there are areas priations bills, only to see them lumped to- er only appropriations legislation, specifying which still require attention. Our Federal gather in one massive spending bill at the end that the Congress could not adjourn until its budget deficit must be addressed if we are to of the fiscal year. Conference committee de- work on these matters is complete. continue this trend in growth. Responsible liberations between the House and Senate on Mr. Speaker, the Congress faces very real levels of spending can be reached through these matters are frenzied and many impor- problems in its inability to fulfill its fiscal re consensus. We also must take positive steps tant decisions that will affect the operation of sponsibilities. Our performance the past 3 to reverse the trade deficit by agreeing upon national defense and domestic programs over years, when none of the 13 regular appropria fair trade practices. Finally, we must continue the course of an entire year are made quickly tions bills have been enacted on time, is proof a sane tax policy. The benefits of tax reform, with little discussion or study. to the American people that we are unable to which was born of bipartisan compromise, Temporary continuing resolutions, such as discharge the duties for which we were elect must be permitted to stimulate growth and the one we are operating under this year ed. There are no easy solutions to these prob produce revenue. We should not strike down through November 10, are disruptive to the lems. What is needed is a willingness of the the advantages we have made by increasing people who manage Federal programs. Agen- Members of this House and the Congress to rates now. cies must bide their time until final spending work together to make the difficult budgetary The policies which we have followed are decisions are made by the Congress. This decisions that will rein in our national debt based upon sound economic principles. These often doesn't occur until more than one quar- before it hits $3 trillion. policies must be continued if we are to sustain ter of the fiscal year is gone. In the meantime, this growth for another 59 months. grant applications can't be solicited and con tracts can't be awarded. This has a chain re REAUTHORIZATION OF THE action which affects State and local program AVIATION TRUST FUND PRO CONGRESS FAILS AGAIN TO sponsors who rely on Federal assistance to GRAM FULFILL ITS FISCAL RESPONSI fund education programs, care for older Amer BILITY icans, and provide for the needy. The inability of Congress to complete its ap HON. DEAN A. GALLO HON. C.W. (BILL) YOUNG propriations work is just part of this body's OF NEW JERSEY OF FLORIDA fiscal irresponsibility. In addition to being IN THE HOUSE OF REPRESENTATIVES IN THE HOUSE OF REPRESENTATIVES faced with a continuing resolution that will fund hundreds of billions of dollars of Federal Thursday, October 1, 1987 Thursday, October 1, 1987 programs, we will be called upon in the Mr. GALLO. Mr. Speaker, with the ever in Mr. YOUNG of Florida. Mr. Speaker, today coming weeks to consider budget reconcilia creasing use of our airways, we must commit we ring in the fiscal year and once again the tion legislation that will cut or reallocate bil adequate resources to maintain and improve Congress has failed miserably in fulfilling its lions of dollars from existing programs. These our air transportation system. It is for this fiscal responsibilities. cuts affect the Medicare Program, veterans reason that I rise to support H.R. 2310, there- 26232 EXTENSIONS OF REMARKS October 1, 1987 authorization of the Aviation Trust Fund Pro AMBASSADOR NICHOLAS M. A REMARKABLE ACHIEVEMENT gram. SALGO-THE GIFT OF THE BY A REMARKABLE MAN Mr. Speaker, H.R. 2310 reauthorizes, for 5 WALLENBERG STATUE IN BU years, the programs supported by the aviation DAPEST HON. ROBERT GARCIA trust fund including capital improvements to OF NEW YORK our Air Traffic Control System and airport fa HON. TOM LANTOS IN THE HOUSE OF REPRESENTATIVES cilities. The trust fund, which is funded by taxes on OF CALIFORNIA Thursday, October 1, 1987 airline tickets and aviation fuel, currently has a IN THE HOUSE OF REPRESENTATIVES Mr. GARCIA. Mr. Speaker, The September/ October edition of Museum and Arts in Wash $5.7 billion surplus. It is inexcusable not to Thursday, October 1, 1987 make these funds available to improve our ington has an excellent article on the Sackler Nation's airports and Air Traffic Control Mr. LANTOS. Mr. Speaker, 6 years ago this Museum of Art. As most of my colleagues System. It is time to act. Flight delays are up month, the President signed historic legislation know this is a museum of African and Asian 21 percent from 1985 and passenger com making Raoul Wallenberg an honorary citizen art. I find this particularly important because plaints about delays, congestion, and other of the United States. At this time, as we com for too long we have not put sufficient empha problems up more than six times over a year memorate and remember that anniversary, it sis on our Nation's African and Asian heritage. The Sackler Museum is a tribute to an emi ago. I urge my colleagues to support Chair is important as well to recognize those individ nent American, former Secretary of the Smith man HOWARD'S amendment to take the trust uals who have helped make the story of sonian Institution, S. Dillon Ripley. Because of fund off-budget. Raoul Wallenberg known here and around the globe. his tenacity and vision, this beautiful museum H.R. 2310 authorizes $8.6 billion for 5 years has become a reality. He has made art and for the Airport Improvement Program [AlP] Ambassador Nicholas M. Salgo-the former United States Ambassador to Hungary and history live for millions of people through the which provides funds for airport planning and Smithsonian. The Sackler Museum is the construction, development of airport terminals, also a native of Hungary-has made a unique contribution to the memory and cause of "jewel in the crown" of the life's work of a acquisition of land for noise abatement pur great American, S. Dillon Ripley. Raoul Wallenberg. In April of this year, in a poses, soundproofing of buildings, and funding I am submitting the Museum and Arts in most unusual decision, the Budapest City for airport safety and other equipment. These Washington article for the RECORD for my col Council approved the erection in the city of vital programs should not be underfunded. leagues' perusal. Newark Airport, which is rapidly becoming the new statue honoring Raoul Wallenberg. In The article follows: fact, the statue was already in place. one of the busiest airports in the Nation, plays RIPLEY's LAsT HuRRAH The new monument was the private gift of a key role in the economic life and well being