I certainly don't have to explain the benefits of free and open markets to you. They produce more jobs, a more productive use of our nation's resources, more rapid innovation, and a higher standard of living. They strengthen our national security because our economy, the bedrock of our defense, is stronger. I'm pleased that the United States has played the critical role of ensuring and promoting an open trading system since World War II. And I know that if we ever faltered in the defense and promotion of the worldwide free trading system, that system will collapse, to the detriment of all.

But our role does not absolve our trading partners from their major responsibility: to support us in seeking a more open trading system. No nation, even one as large and as powerful as the United States, can, by itself, ensure a free trading system. All that we and others have done to provide for the free flow of goods and services and capital is based on cooperation. And our trading partners must join us in working to improve the system of trade that has contributed so much to economic growth and the security of our allies and of ourselves.

And may I say right here to the leaders of industry that my admiration for business in the United States is stronger than ever. You know, sometimes in Washington, there are some who seem to forget what the economy is all about. They give me reports saying the economy does this and the economy will do that, but they never talk about business. And somewhere along the way, these folks in Washington have forgotten that the economy is business. Business creates new products and new services; business creates jobs; business creates prosperity for our communities and our nation as a whole. And business is the people that make it work, from the CEO to the workers in the factories. I know, too, that American business has never been afraid to compete. I know that when a trading system follows the rules of free trade, when there is equal opportunity to compete, American business is as innovative, efficient, and competitive as any in the world. I also know that the American worker is as good and productive as any in the world.

And that's why to make the international trading system work, all must abide by the rules. All must work to guarantee open markets. Above all else, free trade is, by definition, fair trade. When domestic markets are closed to the exports of others, it is no longer free trade. When governments subsidize their manufacturers and farmers so that they can dump goods in other markets, it is no longer free trade. When governments permit counterfeiting or copying of American products, it is stealing our future, and it is no longer free trade. When governments assist their exporters in ways that violate international laws, then the playing field is no longer level, and there is no longer free trade. When governments subsidize industries for commercial advantage and underwrite costs, placing an unfair burden on competitors, that is not free trade.

I have worked for 4 years at Versailles and Williamsburg and London and last at Bonn to get our trading partners to dismantle their trade barriers, eliminate their subsidies and other unfair trade practices, enter into negotiations to open markets even further, and strengthen GATT, the international accord that governs worldwide trade. I will continue to do these things. But I also want the American people and our trading partners to know that we will take all the action that is necessary to pursue our rights and interests in international commerce under our laws and the GATT to see that other nations live up to their obligations and their trade agreements with us. I believe that if trade is not fair for all, then trade is free in name only. I will not stand by and watch American businesses fail because of unfair trading practices abroad. I will not stand by and watch American workers lose their jobs because other nations do not play by the rules.

We have put incentives into our own economy to make it grow and create jobs, and, as you know, business has prospered. We have created over 8 million new jobs in the last 33 months. Just since 1980 manufacturing production has increased 17 percent. But I'm not unmindful that within this prosperity, some industries and workers face difficulties. To the workers who have been displaced by industrial shifts within our society, we are committed to help. To those industries that are victims of unfair trade, we will work unceasingly to have those practices eliminated.

Just a few weeks ago, I asked the United States Trade Representative to initiate unfair trade practice investigations. It's the first time a President has done this. And, as you know, we have self-initiated three such cases that will investigate a Korean law that prohibits fair competition for U.S. insurance firms, a Brazilian law restricting the sale of U.S. high technology products, and Japanese restrictions on the sale of U.S. tobacco products. I have also ordered the United States Trade Representative to accelerate the ongoing cases of Common Market restrictions of canned fruit and Japanese prohibitions on imports of our leather and leather footwear.

But I believe more must be done. I am, therefore, today announcing that I have instructed Ambassador Yeutter to maintain a constant watch and to take action in those instances of unfair trade that will disadvantage American businesses and workers. I have directed the Secretary of the Treasury to work with the Congress to establish a $300 million fund that will support up to a billion dollars in mixed-credit loans. These funds will counter our loss of business to trading partners who use what, in effect, are subsidies to deprive U.S. companies of fair access to world markets. And I've asked that these initiatives be continued until unfair credit subsidies by our trading partners are eliminated through negotiations with them. I have further instructed Treasury Secretary Jim Baker to inform the participants at the International Monetary Fund and World Bank conferences in Seoul that we will take into consideration the trading practices of other nations in our deliberations and decisionmaking.

A major factor in the growth of our trade deficit has been the combination of our very strong economic performance and the weak economic performance of our major trading partners over the last 4 years. This has limited our exports and contributed to the weakening of other currencies relative to the dollar, thereby encouraging additional imports by the United States and discouraging our exports. Yesterday I authorized Treasury Secretary Baker to join his counterparts from other major industrial countries to announce measures to promote stronger and more balanced growth in our economies and thereby the strengthening of foreign currencies. This will provide better markets for U.S. products and improve the competitive position of our industry, agriculture, and labor.

I have ordered the Secretary of State to seek time limits on negotiations underway to open up markets in specific product areas in Japan. I have instructed the United States Trade Representative to accelerate negotiations with any and all countries where the counterfeiting and piracy of U.S. goods has occurred to bring these practices to a quick end. And I look forward to working with the Congress to increase efforts to protect patents, copyrights, trademarks, and other intellectual property rights. And finally, I am today directing that a strike force be established among the relevant agencies in our government whose task it will be to uncover unfair trading practices used against us and develop and execute strategies and programs to promptly counter and eliminate them.

I'm also looking forward to working with the Congress to put into place any necessary legislation that would help us promote free and fair trade and secure jobs for American workers. Among the topics that we should jointly consider are authority to support our new trade negotiating initiatives that would, among other things, reduce tariffs and attempt to dismantle all other trade barriers; to protect intellectual property rights, including trade in articles that infringe U.S. process patents, longer terms for agricultural chemicals, and eliminating Freedom of Information Act abuses that will help our businesses protect their proprietary property; to improve our antidumping and countervailing duty laws so that a predictable pricing test covers nonmarket economies, enabling our companies to have protection against unfair dumping from those countries. We should also improve these laws so that business can have full and rapid protection in receiving help against unfair imports -- to amend our trade laws to put a deadline on dispute settlement and to conduct a fast-track procedure for perishable items. We should no longer tolerate 16-year cases and settlements so costly and time consuming that any assistance is ineffective.

I am also directing the Secretary of Labor to explore ways of assisting workers who lose jobs to find gainful employment in other industries, and I look forward to working with Congress in this vital task. Additionally, I welcome the suggestions of the Members of Congress on other potential legislation that has as its object the promotion of free and fair trade. I will work with them to see that good legislation is passed. Conversely, I will strongly oppose and will veto measures that I believe will harm economic growth, cause loss of jobs, and diminish international trade.

But I do not want to let this discussion pass without reminding all of our ultimate purpose: the expansion of free and open markets everywhere. There are some, well-meaning in motive, who have proposed bills and programs that are purely protectionist in nature. These proposals would raise the costs of the goods and services that American consumers across the land would have to pay. They would invite retaliation by our trading partners abroad; would in turn lose jobs for those American workers in industries that would be the victims of such retaliation; would rekindle inflation; would strain international relations; and would impair the stability of the international financial and trading systems. The net result of these counterproductive proposals would not be to protect consumers or workers or farmers or businesses. In fact, just the reverse would happen. We would lose markets, we would lose jobs, and we would lose our prosperity.

To reduce the impediments to free markets, we will accelerate our efforts to launch a new GATT negotiating round with our trading partners. And we hope that the GATT members will see fit to reduce barriers for trade in agricultural products, services, technologies, investments, and in mature industries. We will seek effective dispute settlement techniques in these areas. But if these negotiations are not initiated or if insignificant progress is made, I'm instructing our trade negotiators to explore regional and bilateral agreements with other nations.

Here at home, we will continue our efforts to reduce excessive government spending and to promote our tax reform proposal that is essential to strengthening our own economy and making U.S. business more competitive in international markets. Further, we will encourage our trading partners, as agreed upon at the Bonn summit, to accelerate their own economic growth by removing rigidities and imbalances in their economies. And we will encourage them to provide sound fiscal and monetary policies to have them fully participate in the growth potential that is there for all. We will seek to strengthen and improve the operation of the international monetary system. And we will encourage the debt burdened, less-developed countries of the world to reduce and eliminate impediments to investments and eliminate internal restrictions that discourage their own economic growth.

Let me summarize: Our commitment to free trade is undiminished. We will vigorously pursue our policy of promoting free and open markets in this country and around the world. We will insist that all nations face up to their responsibilities of preserving and enhancing free trade everywhere. But let no one mistake our resolve to oppose any and all unfair trading practices. It is wrong for the American worker and American businessman to continue to bear the burden imposed by those who abuse the world trading system. We do not want a trade war with other nations; we want other nations to join us in enlarging and enhancing the world trading system for the benefit of all. We do not want to stop other nations from selling goods in the United States; we want to sell more of our goods to other nations. We do not dream of protecting America from others' success; we seek to include everyone in the success of the American dream.

Thank you very much, and thank you for coming.

Note: The President spoke at 11:30 a.m. in the East Room at the White House. Also attending the meeting were Members of Congress, the Cabinet, the President's Export Council, and the Advisory Committee on Trade Negotiations. Clayton Yeutter was the United States Trade Representative.