Message to the House of Representatives Returning Without Approval the Omnibus Trade and Competitiveness Act of 1988
To the House of Representatives:
is with sincere regret that today I must disapprove and return H.R. 3, the
Omnibus Trade and Competitiveness Act of 1988. We worked long and hard to
produce legislation that would enhance our country's ability to meet foreign
competition head-on -- to strengthen our trade laws and remove restrictions on
During this Administration the American economy has created 16 million new jobs. Our unemployment rate is the lowest in 14 years with more Americans working than ever before in our history. And we are experiencing the longest peacetime expansion this country has ever seen.
While this has been going on at home, many of our trading partners have had a different economic situation. Perhaps the most compelling and important comparison is that over the past decade, the United States has created more than twice as many jobs as Europe and Japan combined.
That is not to say that we cannot do more here at home -- we can. That is why I forwarded proposals to improve our competitive strength and why we worked hard with the Congress to try to achieve a positive, forward-looking bill. Unfortunately, that is not the bill the Congress passed and sent to my desk.
The issue receiving the most attention in this bill is the mandatory requirement for businesses to give advance notice of closings or layoffs. I support voluntarily giving workers and communities as much advance warning as possible when a layoff or closing becomes necessary. It allows the workers, the employer, the community, time to adjust to the dislocation. It is the humane thing to do.
But I object to the idea that the Federal Government would arbitrarily mandate, for all conditions and under all circumstances, exactly when and in what form that notification should take place. There are many circumstances under which such mandatory notification would actually force a faltering business to close -- by driving away creditors, suppliers, customers, and -- in the process destroying jobs. While the legislation attempts to mitigate this outcome, its ``faltering business'' exemption is too ambiguous to be workable and invites untold litigation.
These concerns are real, not simply philosophical or theoretical. The experience of the Caterpillar Company in the early 1980's, for example, is indicative of the need to be flexible to meet foreign competition and indeed to survive. They had to utilize layoffs and temporary plant closings to respond to competitive developments. And, as one executive of that company stated, they did not have the luxury then, nor do they now, of knowing with certainty what business conditions would be like 60 days in the future. Without the ability to be agile and responsive, they might have closed their doors permanently.
experience is repeated many times over throughout our economy. One independent
analysis shows that if this law had been in place between 1982 and 1986, the
Over a year ago, I submitted legislation that would provide assistance to workers, employers, and communities in the event of a layoff or closing. The program would serve virtually every dislocated worker who needs it with training, education, and assistance in securing a new job and provide an incentive for giving advance notice of layoffs and closings. Ironically, the one piece of that package that the Congress rejected was a direct incentive for business to give advance notices of closing and layoffs. We need labor laws that fit the flexible, fast-paced economy of the 1990's, not restrictive leftovers from the 1930's agenda. And I encourage the Congress in any subsequent trade bill to include a program that provides incentives for such notice.
There are other provisions in the legislation that provide disincentives to our sustained economic growth or serve some narrow special interests:
-- New restrictions on the export,
transportation, and even utilization of Alaskan oil further complicate the
overbearing regulatory scheme that already impedes the development of Alaskan
oil fields. It is the wrong policy. We need to provide incentives, not
restrictions, for the production of oil in the
-- A mistaken effort to revive discredited industrial policy planning through a so-called Council on Competitiveness that will open even more venues for special pleaders.
-- A requirement to negotiate a new
centralized international institution to arrange the forgiveness of billions of
dollars of debt around the world -- all supposedly without increasing
-- Expanded ethanol imports that could harm
-- An amendment to the Trading with the Enemy Act that prevents the President from moving swiftly to block blatant enemy propaganda material from entering the United States, even during wartime.
While the Congress did a remarkable job in watering down or eliminating the most protectionist provisions, there remain sections of the bill that push us in the direction of protectionism. Closing our borders is not the solution to opening foreign markets. We need to demand to be treated fairly and take a strong stand against barriers abroad. In short, we need to open markets, not close them.
there are objectionable portions of the bill, there are also desirable
provisions. There is negotiating authority so that the next President will have
congressional support to continue to seek agreements that open markets abroad.
That, coupled with new trade law tools to strengthen the hand of America in
international trade negotiations, will mean that this country can enter the
next decade with new agreements that reduce barriers and encourage trade. There
are strengthened protections for intellectual property, such as copyrights, and
a reduction in various handicaps to
That is why I want a trade bill, and why I like much of this bill. But I regret that the addition of a few counterproductive and costly measures outweigh the positive features of this particular legislation. I will continue to work vigorously to secure sound legislation this year.
Let me reiterate what I have said on a number of occasions. I am committed to enactment of a responsible trade bill this year. I have heard some say that there is not time to send me a second bill after my veto is sustained; my response is that there are many months left in 1988 -- time enough to set aside partisanship and finish the job. I want to sign a trade bill this year. I urge prompt action on a second bill immediately after the Congress sustains my veto.
The White House,