THE WHITE HOUSECORRESPONDENCE TRACKING WORKSHEET

INCOMING

DATE RECEIVED: MARCH 30, 1992

NAME OF CORRESPONDENT: THE HONORABLE TOBY ROTH

ID# 318479DCF HAS SEEN

,r~, ,r~W \ncPf\ —

CHttf Gf sWfr

SUBJECT: CONCERNS REGARDING TRADE CONCESSIONS TOTAIWAN ON MACHINE-TOOL PARTS FOR A TWO-YEAREXTENSION OF THE VOLUNTARY RESTRAINTAGREEMENTS ON MACHINE TOOLS

ACTION DISPOSITION

ROUTE TO:OFFICE/AGENCY (STAFF NAME)

SAMUEL SKINNERREFERRAL NOTE:

ACT DATE TYPE C COMPLETEDCODE YY/MM/DD RESP D YY/MM^D

REFERRAL NOTE:

/ lREFERRAL NOTE:

REFERRAL NOTE:

REFERRAL NOTE:

COMMENTS:'ENCLOSURES

ADDITIONAL CORRESPONDENTS:

CS MAIL USER CODES: (A)

MEDIA:L INDIVIDUAL CODES: 1240

(B) (C)

*ACTION CODES:

*A-APPROPRIATE ACTION*C-COMMENT/RECOM*D-DRAFT RESPONSE*F-FURNISH FACT SHEET*I-INFO COPY/NO ACT NEC**R-DIRECT REPLY W/COPY **S-FOR-SIGNATURE **X-INTERIM REPLY *

*DISPOSITION**A-ANSWERED*B-NON-SPEC-REFERRAL*C-COMPLETED*S-SUSPENDED

*OUTGOING **CORRESPONDENCE: **TYPE RESP=INITIALS ** OF SIGNER ** CODE = A **COMPLETED = DATE OF ** OUTGOING ** ** ** *

REFER QUESTIONS AND ROUTING UPDATES TO CENTRAL REFERENCE(ROOM 75,OEOB) EXT-2590KEEP THIS WORKSHEET ATTACHED TO THE ORIGINAL INCOMINGLETTER AT ALL TIMES AND SEND COMPLETED RECORD TO RECORDSMANAGEMENT.

ORG 92/03/30

2352 RAYBURN BUILDINGWASHINGTON, D.C. 20515

TRAVEL AND TOURISM CAUCUSSPORTSMEN'S CAUCUS

RURAL CAUCUSGRACE CAUCUS

MILITARY REFORM CAUCUS

FOREIGN AFFAIRS COMMITTEEINTERNATIONAL ECONOMIC POLICY AND TRADE

ASIAN AND PACIFIC AFFAIRSAFRICA

BANKING, FINANCE ANDURBAN AFFAIRS COMMITTEE

DOMESTIC MONETARY POLICYFINANCIAL INSTITUTIONS SUPERVISION,

REGULATION AND INSURANCEPOLICY RESEARCH AND INSURANCE

March 26, 1992

Mr. Samuel K. SkinnerChief of Staff to the PresidentThe White House1600 Pennsylvania Avenue NWWashington, D.C. 20500

Dear Sam:

News reports are disturbing to me that the United States ispreparing to offer trade concessions to Taiwan on machine-toolparts to win consent for a two-year extension of the VoluntaryRestraint Agreements (VRAs) on machine tools.

Additionally, my information is that Deputy U.S. TradeRepresentative Michael Moskow is on the verge of granting stillmore special trade favors to an Indianapolis-based importer ofTaiwan-made machine tools.

While such proposed actions may be well-meant, they areperceived as extremely threatening to the vital U.S. machine-toolindustry, particularly to constituent companies in Wisconsin.

One of our most important companies, Giddings & Lewis, Inc.,of Fond du Lac, Wisconsin, is driving hard to be competitive in themachine-tool industry, being the fifth largest factory automationand machine-tool manufacturer in the world. Indeed, last year theentire Wisconsin congressional delegation united to help persuadethe U.S. Department of Justice to approve Giddings & Lewis'proposed acquisition of financially troubled Cross & Trecker.

Not the least of industry worries is that undue concessions toTaiwan unnecessarily risk losing Japan's crucial support forextension of the VRAs.

Enclosed for your reference are copies of my earlier letterand enclosures. Please tell me how to respond to my Wisconsinindustrial constituent.

Sincer

Member Congress

PRINTED ON PAPER MADE WITH RECYCLED FIBERS

DEPUTY UNITED STATES TRADE REPRESENTATIVEEXECUTIVE OFFICE OF THE PRESIDENT

WASHINGTON, D.C. 20506

JUL 15 1992

The Honorable Toby RothU.S. House of RepresentativesWashington, D.C. 20515

Dear Congressman Roth:

This is in response to your letter to Samuel Skinner expressingyour concern and that of your constituent, Giddings and Lewis,regarding the pace and coverage of our efforts to negotiatemachine tool voluntary restraint agreements (VRAs) with Japan andTaiwan.

Since your letter, we have successfully concluded agreements withboth Japan and Taiwan. We believe that these agreements willpermit U.S. companies to complete the necessary programs foradvancing U.S. national security interests while providing agradual return to market-determined competition. While thenegotiations were long and difficult, the final agreementsassured that imports of machine tools in the period prior to theagreements would not be allowed to undermine the President'smachine tool revitalization program.

I would like to correct one additional point in your letterregarding positions attributed to me with respect to thetreatment of special issue permits. At no time did I supportspecial favors for any individual company. As the finalagreement with Taiwan clearly indicates, there is no specialallocation of machine tools for any individual company. Theagreement contains a generic provision through which individualcompanies may petition the Department of Commerce for access toadditional machine tools or parts. This provision is virtuallyidentical to that contained in the 1986 VRA and we expect thatthe Department of Commerce will administer it in the same way asit did previously.

Our objective throughout the negotiations was to implement thePresident's decision of December 27, 1991 to maximize thecontribution of the domestic machine tool industry to ournational security interests.

Sincerely,

Michael H. Moskow

MHM:de