Congress Back; D eficit Still There
THE EARLY RHETORIC when Congress returns today from its August recess may tip off how legislators will approach the budget deficit issue.When Congress left two weeks ago, it had just been told its fragile budget package wasn't enough to bring the fiscal 1987 deficit down to the $154 billion level. The Senate Budget Committee chairman, Pete Domenici, R-N.M., vowed to come back with a bigger, better package that fixed things once and for all.
But Senate Majority Leader Robert Dole, R-Kan., worried more about the 1986 (and 1988) elections, is pushing for a quick cosmetic fix.
If Congress passes the tax reform bill quickly, it would pick up $11 billion in additional first-year revenue. That might be just enough to satisfy Gramm-Rudman deficit act requirements until next year.
THE NATIONAL ASSOCIATION OF MANUFACTURERS has a present awaiting returning senators.
It's a massive phone-in campaign designed to force the Senate to go beyond just talking about product liability law reform, and actually pass a bill. Not only will NAM members be calling, but its is coordinating its efforts those of a dozen or more other major trade associations. The thousands of telephone calls they hope to make to all senators Tuesday will support passage of the pending product liability legislation but with amendments to limit the liability of individual companies in cases where more than one company is considered at fault.
NOBODY'S GIVEN UP YET, but chances are slim to non-existent for enactment of a new maritime subsidy program. The Reagan Administration still sees as too costly the industry-inspired, congressionally supported proposals to extend subsidy to all U.S. liner companies at a reduced cost for each ship.
The key difference remains the prospect that too many ships are likely to be brought under a new program with too large crews.
Along with the administration, Senate budget writers are not willing to see more money devoted to ocean shipping. Efforts to bridge that gap will be made, but there seems little hope for success.
THE DEGREE OF FREEDOM the administration will have to dispose of Conrail is bound to become a key issue as the House Energy and Commerce Committee
considers legislation to transfer the railroad to the public sector.
The Department of Transportation has been pushing for the greatest amount of flexibility possible - some contend total independence - in dealing with the railroad ever since it was created in the mid-1970s.
But Congress has been slow to yield such freedom, in part because of feeling that the $7 billion in federal funds invested in the railroad requires an active Hill oversight role. One observer expects the issue to come up again and further complicate the bill's chances.
TWO SENATORS, Max Baucus, D-Mont., and John H. Chafee, R-R.I., soon will add a new complication to the already controversial trade bill by drafting legislation that eases export controls.
The control legislation is not yet complete, but will contain many of the elements of a House-passed bill to trim controls over a three-year period. The export control changes will be offered as amendments to the trade bill, which may be taken up by the Senate Finance Committee in the next week or so.
TRADE ATTORNEYS ARE BRACING FOR an outbreak of dumping complaints against Japanese and some West European exports. The reason is that many Japanese and European companies don't seem to be adjusting their prices as much as might be expected to reflect the depreciating dollar.
Both the Japanese yen and the German mark, for instance, have appreciated by more than 60 percent against the dollar in the last 18 months.
But Japanese and European prices have not risen by anywhere close to those percentages. Japanese car prices, for example, are only about 12 percent to 15 percent higher than a year ago.
The Commerce Department normally gives traders about three months to adjust their prices to exchange rate changes. If they don't do so, foreign exporters become vulnerable to U.S. producers' asking the government to impose anti-dumping duties.
U.S. TRADE REPRESENTA TIVE Clayton Yeutter plans a ma jor speech Wednesday before the U.S. Chamber of Commerce. The is sue: a new round of international trade negotiations.
Mr. Yeutter calls it the most critical trade round since World War II. Freer world trade, especially to help developing countries, will be a basic round objective.
This weekend, he and trade ministers from about 90 nations, start what he expects will be tough bargaining at Punta del Este, Uruguay, to map out the new trade round. U.S. trade negotiators say they are cau tiously optimistic that most, if not all, of the ministers will reach an accord before the week ends.
The United States and the United Kingdom begin a new round of talks this week aimed at coming up with a new bilateral aviation agreement. The last agreement, restricting ca pacity in the trade, expired in July and a new one is considered vital to Prime Minister Margaret Thatcher's plans to privatize British Airways.
The United States is willing to go along with some restrictions so long as they are loosely structured.