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Document 6 of 124.

July 19, 2000, Wednesday

SECTION: CAPITOL HILL HEARING

LENGTH: 8796 words

HEADLINE: HEARING OF THE SENATE COMMERCE, SCIENCE AND TRANSPORTATION COMMITTEE

SUBJECT: THE NOMINATION OF NORMAN MINETA TO BE COMMERCE SECRETARY

CHAIRED BY: SENATOR JOHN MCCAIN (R-AZ)

LOCATION: 253 RUSSELL SENATE OFFICE BUILDING, WASHINGTON, D.C.

TIME: 9:40 A.M. EDT

WITNESSES:

NORMAN MINETA, NOMINEE TO BE SECRETARY OF COMMERCE FORMER CONGRESSMAN FROM CALIFORNIA

SENATOR BARBARA BOXER (D-CA)

SENATOR DIANNE FEINSTEIN (D-CA)

BODY:
SEN. MCCAIN: Today the committee meets to consider Norman Mineta's nomination to be the United States secretary of Commerce.

Norman Mineta is one of my colleagues from my days in the House of Representatives. I welcome him before the committee and congratulate him on his nomination to this prestigious post.

Mr. Mineta, would you like to introduce your family members who are here for this occasion? MR. MINETA: Mr. Chairman, thank you very much. I would like to introduce my wife, Denny (sp), and my stepson, Bob Brantner (sp), and my sister, Etsa Mineta Masoka (sp), and her granddaughter, Michelle Amano (sp).

SEN. MCCAIN: Could you all stand, so we can all recognize and -- (laughter) -- thank you. Thank you. Thank you. (Applause.) Thank you, and welcome, and I know this is a very proud moment for all of you.

Mr. Mineta has a long record of distinguished public service. He served 20 years in the House as the California representative of Silicon Valley. During part of his tenure in the House, Mr. Mineta served as chairman of the then-Public Works and Transportation Committee. Mr. Mineta currently serves as vice president of special interest initiative -- special business initiatives at Lockheed Martin Corporation.

This is not the first time that Norm Mineta has come before the committee. The Senate recently approved his nomination to serve on the Metropolitan Washington Airports Authority. The president also recently appointed him to chair the Advisory Commission on Asian American and Pacific Islanders.

As most of us know, as a young boy, Mr. Mineta and his family were among the Americans of Japanese ancestry forced into internment camps during World War II.

We can all probably acknowledge that Secretary -- Commerce Secretary Daley made a valiant effort to clean up the Commerce Department's reputation as a dumping ground for the politically connected. I hope that Mr. Mineta takes this mission seriously. He and I have discussed my concerns about the more recent revelations concerning the alleged political nature of the Commerce Department trade missions.

Again, Norm, I want to congratulate you on this momentous occasion in history. I'm sure that I speak for the rest of my colleagues when I say that we are proud and heartened to welcome you back to the life of public service.

It's my intention to move your nomination out of the committee as soon as possible. And thank you for your appearance today.

I would like to mention that Senator Hollings, a former chairman and ranking member of this committee, strongly supports your nomination. He is not here because he had recently experienced a death in his family. And if it's agreeable to the witnesses, I'd like to begin with our very senior senator and dear friend and colleague, Senator Inouye.

SEN. DANIEL INOUYE (D-HI): Mrs. Feinstein, please.

SEN. MCCAIN: Whatever you say, Senator Inouye. (Laughter.)

Senator Feinstein?

SEN. FEINSTEIN: Thank you very much, Mr. Chairman and Senator Bryan.

As we were talking, before you came in the room, I realized that I have known Norman Mineta now for 30 years. In 1970, I was president of the San Francisco Board of Supervisors. He was a member of the San Jose City Council. He then went on to become vice mayor and then, in 1971 to 1974, mayor of the city of San Jose. He is a native son of California. He grew in San Jose's Japan Town. He attended public school.

In 1942, when he was 11, his family was among 120,000 Japanese Americans forcibly removed to concentration camps on the West Coast because of their ancestry. I think fittingly, one of his career highlights in Congress was the leadership in the enactment of the Civil Liberties Act of 1988, which called for a formal apology and $20,000 in compensation to each Japanese American survivor of these internment camps.

He graduated from the University of California at Berkeley in 1953 with a Bachelor of Science in Business. He immediately joined the United States Army. He served there from 1953 to '56. Upon his return, he entered the insurance business and became active in San Jose urban affairs. He served on the San Jose Human Relations Commission and the San Jose Housing Authority prior to his tenure on the city council.

In 1967, he was the first ethnic minority elected to the city council, and that began his string of firsts; as mayor of San Jose and as the first Japanese American from the continental United States to be elected to the House of Representatives. When he assumed the chairmanship of the House Committee on Public Works and Transportation, he became the first American of Asian ancestry to chair a major committee in the House. And of course, should the Senate confirm his nomination as Commerce secretary, he would become the first Asian American to serve in the president's Cabinet.

I have learned to come to appreciate Norman Mineta over the years.

The older I get, I find sometimes there are two kinds of people -- problem makers and problem solvers. Norman Mineta is a problem solver. I think his 21 years of experience on the Hill in a whole panoply of committee assignments and, particularly, as chairman of the Committee of Public Works and Transportation, he demonstrates a very solid knowledge of the interreaction between people and business, and I think he's going to be a very strong and positive Commerce secretary. Frankly, I only wish this happened earlier in this president's tenure. He has the knowledge, he has the legislative background, he has the experience and he has the ability, I think, to be a very fine secretary of Commerce.

So Mr. Chairman, it's with a great deal of pleasure that I be here this morning simply to indicate my strong support and my hope that you just stated that this committee will speedily process his confirmation. I thank you very much.

SEN. MCCAIN: Thank you. Who's next, Senator Inouye? (Laughter.) Senator Boxer.

SEN. BARBARA BOXER (D-CA): Thank you, Mr. Chairman. I want to associate myself with the remarks of my senior senator, and I won't be repetitive. I'm just going to talk from the heart about Norm Mineta for just a moment, if I might.

My heart is full of joy today, and it is full of joy for Norm, for his family, for Asian Americans, for all Americans, because, Mr. Chairman, I know you know this and you believe this, that when we do open the door to all of our people, we are such a better nation. And today another door is being opened. It's a wonderful day, and I agree I wish it would have been opened years ago, in this particular case, but here it is. And what it means is that the door will be open to so many others who might not have been considered. So it's a huge day. Senator Feinstein noted the number of firsts. It's hard to be a first. A lot weighs on you, and I know Norm feels a lot of emotion today.

I just want to say, when I served with Norm for 10 years in the House of Representatives -- Senator Feinstein is right -- a problem solver. And Mr. Chairman, I hope you will have the opportunity in the brief time that is left on this particular term to work with this fine, soon-to-be, I hope, Commerce secretary, because in his district there were so many different points of view and so much diversity and so many Democrats, so many Republicans, Independents; he was able to bring everyone together, which is a wonderful trait, and make progress for everyone.

So it is a wonderful day. I'm very honored to be here before you and your colleagues, my colleagues.

It is a tough day. We've lost a senator in a tragic way. Some of our colleagues have suffered personal losses. So Norm, you bring us joy today, and I'm just pleased that you asked me to be here with you.

Thank you very much.

SEN. MCCAIN: Thank you, Senator Boxer.

Senator Inouye.

SEN. DANIEL INOUYE (D-HI): Thank you, Mr. Chairman.

Mr. Chairman and members of the committee, I'm most privileged to be here this morning to join the distinguished ladies of California to support Norm Mineta for the office of Secretary of Commerce.

Norm Mineta's life story is in a real sense a celebration of America. It's a story of sadness, it's a story of sacrifice, of pain, and yet it's a story of success and of service and, if I may add, glory. Here's a young man who, at a time when he was beginning to understand the complexities of society, had to leave his home with his parents to go to a desolate, strange place in Wyoming called Hot Mountain, and there he spent nearly two years. And this was his adult education of America. But instead of leading a life of gloom and bitterness, he returned home, dedicated to serve his country. And that's his life story. As our ladies have indicated, he served on the city council, then he became mayor and a distinguished member of the Congress.

Mr. Chairman, I'm fully convinced that he will be an outstanding member of the Cabinet. I'm certain he will be a glorious footnote in the history of America. So I sit here with my lady friends without any qualifications but one; I'm his friend and he's my friend. And I can assure you, Mr. Chairman, he's a good man.

Thank you.

SEN. MCCAIN: Thank you, Senator Inouye. I thank all of our friends from California for being here. I know you have a heavy schedule and you can't stay, but you're welcome to. But I thank you all for appearing today.

Senator Bryan.

SEN. RICHARD H. BRYAN (D-NV): Thank you very much, Mr. Chairman. I would associate myself with the glowing remarks of our distinguished witnesses and the opening statement that you made.

You know, the president has chosen wisely. Mr. Mineta has a distinguished career in public service. The American public will be fortunate again to have his service in their behalf, as the secretary of Commerce. I enthusiastically support and endorse the nomination. And like you, Mr. Chairman, I am hopeful that we can move this nomination as quickly as possible so that Mr. Mineta will be able to assume his duties and responsibilities on behalf of the American public.

And on a personal note, having known him for many years, I am very pleased for him personally and his family. This is a wonderful opportunity. It does -- as Senator Inouye said, it is an American success story. And I congratulate you and the president for your selection.

SEN. MCCAIN: Thank you, Senator Bryan.

Senator Rockefeller?

SEN. JOHN D. ROCKEFELLER IV (D-WV): Thank you, Mr. Chairman.

I just pointed out to Senator Inouye -- I have been on this committee, Congressman Mineta -- I guess I have to call you for the moment -- and I have heard many presentations of candidates. But I have never heard them given in such deep and emotional, spontaneous terms. I mean, this was very genuine people talking about somebody who they very genuinely respect. I share that view.

And I share particularly the historical significance that Senator Inouye referred to. He didn't say that you're the first Asian American; he didn't specifically talk about internments and injustices done, but they were in his comments and in his heart. And I think it is a powerful day that America becomes whole, as you become the first Asian American to serve in the United States Cabinet.

But that in and of itself wouldn't qualify you. It's a right and just thing, but it wouldn't qualify you. But you also happen to bring all of the other things that are necessary, too. During the course of questioning, we'll talk about steel, which you and I have discussed, and the digital divide, the spectrum, the whole question of spectrum division. But you have the toughness, the executive experience, the legislative experience, the personal nature of conflict resolution, bringing people together, the intensity of public service; that concept of public service, which is so valuable and increasingly rare. Although I think it lies in the hearts of all Americans, it's not manifested as it once was.

But you understand it in a unique way, as Senator Inouye understands it in a unique way. I am embarrassed on behalf of the committee that there are not more of us here to join with you. You surely have my full support.

SEN. MCCAIN: Welcome. You may proceed.

MR. MINETA: Mr. Chairman, thank you very, very much. It is a great honor and personal privilege for me to have this opportunity to appear before you and the members of the Senate Commerce, Science and Transportation Committee this morning.

First of all, I would like to extend, on behalf of Denny (sp) and me our deepest sympathies to the Senate family, to the family of Senator Coverdell, and to Senator Hollings on the loss of his brother. Senator Hollings and his wife Peatsy are close friends, and so our sympathies and prayers and thoughts are with the Coverdell family and to the Hollings family.

SEN. MCCAIN:? We thank you.

MR. MINETA: Mr. Chairman, I would like to especially thank you for the courtesies that you have extended to me since President Clinton announced my nomination some short three weeks ago. Since then I've had the opportunity to reach out to you and to each senator of this committee, including the distinguished ranking member, Senator Hollings, with whom I have worked hard and long over many years. And I'm also delighted to thank my fellow Californians for their very generous comments. Both Senators Boxer and Feinstein have been great friends for many, many years and they are extraordinary representatives of the Golden State, and I am proud to have them in my company.

I must also say what a great personal honor it is for me to be joined at this table by your committee colleague and my friend of close to 40 years, Dan Inouye. The senior senator from Hawaii is a man I admire in numerous individual dimensions of humanity and public service. And when the senator received his Congressional Medal of Honor from President Clinton four weeks ago today, it was a proud moment for every American, but perhaps especially for those of us who have known and respected Dan for so very long.

Mr. Chairman, as you know, I have looked forward to the fullest possible conversation today, and so with that in mind, I will keep my opening statement brief to help devote this hearing to the questions that all of you will have.

When the president nominated me to be the next secretary of Commerce, I said that six months is a virtual eternity in the new economy, and it is. I am honored by and grateful for his confidence in me, and I look forward to helping contribute this longest period of sustained economic expansion in American history.

As many of you may know, my parents came to the United States from Japan some 90 years ago in search of the American dream. And my father was actually supposed to have come to Spreckles, California, to work at the Spreckles Sugar Farm. Not knowing that much about U.S. geography, he got off the ship in Seattle, Washington -- (laughter) -- 1,100 miles away from where he should have been. And as a boy of 14 years old, not knowing the language nor the culture, and knowing that he had to get to Spreckles, California, he then worked from one labor camp -- lumber camp, farm camp -- worked his way down to California. And he eventually founded a small insurance agency in San Jose, California, in 1920.

Now that business remained small, but my father and my mother's dream remained large, in many ways focused on their children and our full acceptance into American society and economic opportunity.

Mr. Chairman, the American economy our parents knew and worked in to raise us has been rebooted many times. And I would like to commend especially the work done by Secretary William Daley to reboot the Commerce Department, which I know to be a prime interest of this committee. But because of Bill Daley's commitment and partnership with you, the Commerce Department today is much more efficient, effective, and transparent in its operations. And if confirmed by you and the full Senate, I will continue to make this work-in-progress a top priority.

This commitment, which I make to you and to every constituent of the department, should come as no surprise. During my 21 years in the House of Representatives, I had the privilege to serve the American people alongside many of you. So please forgive my repeating a personal mantra that you have probably heard before. I believe very strongly that accountability and accessibility are among the greatest responsibilities that every public servant owes to the letter and the spirit of the Constitution of this great United States. The American people have the right to expect us to observe these principles as matters of basic good government and to use them in our partnership with the private sector.

I believe that new markets, free and fair trade, research, enabling the creation of advanced American products and services, e- commerce, a policy of digital inclusion to bridge the digital divide, and the best scientific data are neither partisan domains nor the province of one-size-fits-all prescriptives from Washington, D.C., or anywhere else. And the advocacy of these principles, practices, and services to the American people will be foremost among my efforts as Commerce secretary.

Six months of opportunity and responsibility will demand a greater focus to make a greater difference in that time. And I plan to focus my energies and the energies of the department in four areas:

First, keeping people in business. This means keeping the economy growing, Americans more prosperous, and developing new international markets for American business. We must always remember that people are our business, and we must continue to invest in our workers, their opportunities and their communities.

Secondly, investing in our nation's future. For the past 30 years, the National Oceanic and Atmospheric Administration has been the nation's leader in predicting and protecting the environment. Americans today enjoy the best weather service in the world. Our ports are more efficient and environmentally safe. And rebuilding our fisheries is a top priorities. In all matters, I will continue to focus our best science on managing our coastal and marine resources.

Investing in our nation's future also means making sure that we have the technology and the policies to fuel the new economy. Across Commerce, people are doing crucial work on research and development, technology diffusion and infrastructure modernization, and I intend to see that this work stays in high gear and on track.

Thirdly, continuing to mainstream the new economy. Our policies and programs must reach out to help every individual in every business transform ahead of our global competition.

And fourthly, accessible and accountable government.

The department has taken great strides to make its expertise and services more available to the American people, who are, after all, our customers. We must continue these reforms and modernization.

So, Mr. Chairman, I believe these goals are also the result that the American people expect from us. And I look forward to working with each and every one of you to keep all sectors of the economy strong and growing throughout this time.

Thank you very much.

SEN. MCCAIN: Thank you very much.

And again, I want to add my congratulations on this truly outstanding appointment by -- for a great American.

I am very pleased to know of your record of commitment to free trade, your appreciation of the importance of open markets both here and abroad, and, obviously, one of the areas that I think will take some more of your time and attention, and that is of aviation and open skies agreements. Both in the case of Britain and the case of some Asian countries, we have not achieved the kinds of agreements that we would like to see, for the benefit of Americans as well as citizens of other countries. Would you like to comment on that a little bit?

MR. MINETA: Yes. You have, Mr. Chairman, been the leader in this whole area and, having chaired the House Subcommittee on Aviation for eight years, have had a very keen interest on issues related to aviation. And so I am very much committed to the whole area of Open Skies, where there would be -- as it relates to Europe, Africa, Asia, wherever it might be. And I intend to pursue that line as the secretary of Commerce, working in conjunction with the Department of Transportation and the USTR.

SEN. MCCAIN: But I thank you because I think you're uniquely qualified to address what I think is an issue that it going to become more and more important. More Americans in history are visiting Europe this summer. I think that even more could have if the prices had been on the affordable level; that although we complain a great deal on this committee, and I am one of them, about the domestic services, when you look at the airfares that prevail in Europe and in Asia, as compared with the United States, it's dramatically different.

I'd just have two or three other questions. This one relates to the ongoing litigation regarding Freedom of Information Act requests concerning the Department of Commerce trade missions. The trade- mission litigation represents an unfortunate, and I believe easily avoidable, instance of administrative stonewalling. I want to draw your attention -- I did when you visited my office -- to the Washington Post article that I noted when you met with me. I would request that you commit that in all instances, the department be as forthcoming as possible in response to Commerce Committee requests for documents, as well as all other legal requests of the department.

MR. MINETA: Absolutely, Mr. Chairman.

This is an area in which Secretary Daley took a very hard view, in terms of making sure that trade missions were a very transparent and open process. And I think he went a long way towards reforming the process, to make sure that the substance of those trade missions really were paramount and that the political nature of those were minimized. And so I want to continue that policy and make sure that it is transparent and also to make the information available within the prerogatives of protecting privacy or proprietary information.

SEN. MCCAIN: I thank you. And I share your opinion about Secretary Daley's efforts to really make a trade mission what a trade mission should be. And I do agree that trade missions are important; I have no problem with them per se.

I also request your commitment that, if you're confirmed, that you would order any Commerce Department employee to testify before the Commerce Committee, if the committee deems their testimony important, to discover the manner in which the Commerce Department trade missions were used, both appropriately to promote trade and perhaps inappropriately as a reward for political contributions.

MR. MINETA: Absolutely. Any of that would be all done within the prerogatives of what would be provided by law.

SEN. MCCAIN: I thank you.

In a sworn affidavit, a Commerce Department career civil servant, who had supervisory authority over all Freedom of Information Act matters, stated, "The Office of the General Counsel staff" -- quote -- "improperly assumed and exercised the final authority to approve or disapprove the release of documents responsive to FOIA requests submitted by Judicial Watch."

Many times, the FOIA staff was not notified what documents had or had not been released. The employees further asserted that the general counsel's procedure in this instance, quote, "was and is inconsistent with the Commerce Department's written prescribed rules for responding to Freedom of Information Act requests." Can you give the committee these rules? Would you submit to the committee these rules that prevail?

MR. MINETA: I would have no problem in doing that, Mr. Chairman.

SEN. MCCAIN: Thank you.

MR. MINETA: All of these things, of course, took place quite some time ago, and I believe that the kinds of reforms that have been placed, or put in place, I think will in the future avoid similar pitfalls.

SEN. MCCAIN: I agree. Do you know if these rules allow for the intervention, or prevent the intervention, of White House staff in Commerce Department FOIA requests? You may want to --

MR. MINETA: No, Senator, I'm not aware of that detail.

SEN. MCCAIN: The U.S. District Court indicated in its December, 1998 opinion that sensitive classified information concerning national security matters had been removed from the Department of Commerce. I would appreciate it if you would provide the committee with the procedures now in place to ensure that classified documents are not removed from the department.

MR. MINETA: I will do that.

SEN. MCCAIN: At about the time of Secretary Daley's confirmation hearing before this committee, significant allegations had been raised that the Commerce Department was being used by certain individuals for fund-raising purposes. Then-Commerce Secretary Nominee Daley assured me that he would not tolerate such conduct. Last week, in the Washington Post, there were reports that the former head of the Commerce Department Office of Business Liaison sent fund-raising letters to trade mission participants.

I can't judge the accuracy of these statements; nevertheless, they are disturbing. Therefore, could you tell me what safeguards you would propose to ensure that political activities don't occur in conjunction with Commerce Department trade missions?

MR. MINETA: Well, first of all, there would be a total separation so that if there is any kind of political activity related to a trade mission that there would be a firewall placed between them. Even in assessing who will be a member of the trade mission, a firewall will be there.

And the other part of it, I think, Mr. Chairman, is that in reviewing who gets to go on these trade missions, there is a panel, and the panel is, as I recall, in the majority, made up of civil servants. And so, to the extent that it is not the political side that's making the decision but that there is the very strong input from the professional career bureaucrats. And plus, on top of that, the after-trade mission report, again, will, I think, make sure that the political aspects of it are minimal -- minimized -- if totally (not) prohibited, and that these people are there because of the substantive nature of the trade mission.

SEN. MCCAIN: I thank you and, again, you and I are in agreement. Trade missions, I think, are important.

I'm very concerned, as I know you are, about the situation in Africa. I'm very pleased that we passed legislation which may enhance our ability to help the African countries through more free and open trade. And yet I see a lack of U.S. investment, which is understandable. I see a continued deterioration in that very unfortunate continent. I wonder if you've thought about ways that perhaps we can put more emphasis and perhaps improve the situation in that very tragic continent.

MR. MINETA: Well, I suppose that, like a lot of the underdeveloped countries, lack of financing is probably the core of their ability to do something. And even though, let's say, as a regional -- in terms of the region, even if governments got together and agreed on a certain project or a certain path to undertake, the lack of finances keeps them from pursuing their goals.

So I would hope that in that instance, that the Department of Commerce would be able to help dealing with the development banks that exist or with the World Bank or other kinds of financing mechanisms that are available, including our own direct assistance programs, to be able to help. And I think there are a number of them as they relate to aviation, especially at it relates to open skies. And I would like to work with the Department of Transportation on those efforts.

SEN. MCCAIN: Thank you.

Senator Inouye.

SEN. INOUYE: Mr. Chairman, I thank you very much.

I have two questions, one on the National Marine Fisheries Service, and the second on the role of high technology. But in the spirit of expediting the proceedings, may I submit these questions to the nominee?

SEN. MCCAIN: Without objection.

Senator Rockefeller.

SEN. JOHN ROCKEFELLER (D-WV): Thank you, Mr. Chairman.

Mr. Mineta, you and I have already discussed the steel situation, and that obviously is of great importance to relatively few states, but in those states, it becomes a paramount issue. There is a steel report which is due out, I believe, this week, and the whole question of dumping, which is widespread in this world, which has enormous economic consequences, which is not -- you know, as some would say, everybody's for free trade. But we're moving more and more towards a rules-based society. That's what WTO is all about. That's what common commercial practice is meant to be about. So the question of dumping and countervailing duties and circumvention, all of these things are tremendously important. And we've discussed those issues. So I wanted to just mention that again.

Also, you do a lot of very, very important things in the Commerce Committee. One of them which is not very well known, and which the administration has not particularly been helpful to in this year's budget, is something called EPSCoT, which has to do with not research but with technology.

And it takes areas of the country and universities and other areas that -- other entities which are not necessarily top-tier; they're not Stanfords and MITs, but they have a lot to offer. And it encourages them. EPSCORE (sp) does that. EPSCoT does that. And I want to particularly emphasize both of those programs to you. They were started in the '80s and the '90s. They have made a lot of difference in my state. They're small. They're easy to ignore, easy to forget, but they are significant. So I would just put that to you.

And then, in the form of a question, in the rage and mania of technology across this country, it's very easy to talk about the digital divide, but then in one's heart not really to, when it comes down to voting, to do anything about it. There's a feeling on this committee and other committees throughout the Congress that the Internet world must be left alone because what they do is what they know best, and they know it better than we do; therefore, you know, we should just stay out of the way, which gets to be a little bit more difficult when you start thinking about local tax bases, school systems, national security, other areas.

But my concern is the digital divide in terms of, as they say, those places that are guaranteed a future because not only technology, the Internet, the use of the Internet, but broadband, the placement of broadband, will be there, as opposed to probably the 80 percent of the land mass of this country -- not the population but the land mass of this country -- which will not have, for example, broadband services. People who look at the digital divide and choose not to be really serious about it often say, "Oh, that's just digital delay." And it isn't. It isn't.

In my state, every week that passes where we are at a disadvantage to other places which are thriving because of infrastructure and efforts that we do not have, both on the part of the public sector and the private sector, are deeply costly ones, ones which cause our 12-, 13-, and 14-year-olds to prejudge their future in our state and therefore to decide to go elsewhere, which has been the history of our state for a variety of industrial revolutions, so to speak.

And I'm interested in your view on this question of digital divide versus digital delay, and where you think, through the TOP and other places, that the Department of Commerce can be helpful.

MR. MINETA: Senator, having represented the Silicon Valley area for 21 years, I'm very acutely aware of the ability of technology to really make a difference in someone's life. And I think in terms of our own expansion of the economy, technology has played a very large role.

And that's why, in my statement, I really talk about digital inclusion, because I don't want to leave areas behind. My whole being is about dealing with the issues of the underserved and underrepresented. And so whether it's in technology or whether it be in civil rights, or it be in housing or any other areas, I am strongly committed to inclusion.

And so when I see technology coming along and yet it may be fine for center city -- and it may not work in the rural areas; and even if it does work in center cities, it may not get into the depths of the areas where minority and the others are living, it seems to me we have a duty to look at those areas and to try and do something about it.

Now, this is I think, where the public and the private sector can really shine in terms of their work effort. And so, given the resources of the department and the technology that's available there, and with the private sector, it seems to me that we can do something about making sure that communities are not left behind.

I remember -- and you probably saw that news article -- when the president was dealing with trying to expand the whole issue of Internet capability. And he was in Shiprock, New Mexico, I believe, the community. And he was honoring a young lady, a girl in grade school, who had won a computer in a contest. But she had no telephone service at home, so she had no way to connect up to the Internet. Now that's one example.

But it seems to me that you would be in a position to cite the kind of leaving-behind that there might be. And I want to work with you and the others to make sure that we have inclusion because that's really what I am all about.

SEN. ROCKEFELLER: And I believe and accept that, Mr. Mineta. And I just can't stress how important this is and how scary it is to me. It's a little bit like Internet access and having a computer in your home, as opposed to just at the schools, when that happens in every classroom. It's almost like if something is being built into your DNA, that you're predestined by the currents of the economy to make it or not. And there comes to be very little that you can do about it because this is not something that an individual can -- I mean, sure, it's -- you know, somebody from southern West Virginia can decide, "Well, I am going to go to Carnegie Mellon University and become a real Computer Science pro." Cisco has Cisco academies all over the country, all over the world, trying to do their best.

But all of these efforts, when added up, fall tremendously short. And so I really understand it when people talk about the digital divide as being the next civil rights movement with all of the passions and the dangers and, in many ways, since much of the civil rights movement was nonviolent, based upon that philosophy, that this will not necessarily be that way, because we are not just talking about America here; we are talking about the African Subcontinent that the chairman was speaking about, others across the world, who don't have this.

And if they're denied technology and they feel that it's built into their DNA so to speak, that there's no way out for them -- and, therefore, they are condemned to low wages and a life of poverty -- and I think this will happen, you know, unless intervention is made on a massive scale -- that they will resort to using the very technology that they don't have against those who do have it. And I think this is the whole question of international terrorism in a new form, where people are simply angry because they have been systemically and predictably left out and can see that from a very early age. Now, terrorism is not what I'm here to talk about, but the digital divide is.

I will pass and simply submit my question on spectrum management to you, in the interest of time. But there is simply no way for me to talk strongly enough about what I think the digital divide is in the process of doing to this country. I can see it in my own state. I see it in the State of New Mexico that you referred to a few moments ago, and many other rural areas.

I see it in broadband, where Bell Atlantic, which is our phone company, has broadband plans but they have it for five of our 55 counties, and they are all contiguous and they're where all the people are and where all the people of wealth are. But the counties where -- like Calhoun County, where you have 26 to 30 percent unemployment -- rural areas in a state which is 96 percent mountainous is, obviously, preordained, too -- they have no part. They have no future. They are not quite aware of that yet, but I am and you are and it's unfair. And the public and the private sector can make a difference, and has to, in my judgment.

I thank you, Mr. Mineta, and I look forward to supporting you. Thank you very much.

SEN. MCCAIN: We intend to move your nomination as quickly as possible. We'll make every effort to do it before the recess, and I know that the other members of the committee will join in that, and so I will not make that my closing comment, because I see our friend Senator Ashcroft here. (Laughter.)

SEN. JOHN ASHCROFT (R-M0): Thank you, Mr. Chairman. Mr. Mineta, I want to thank you for appearing before the committee today, and I've appreciated your remarks and appreciated your responses, and I'm grateful to you. I want to commend you and thank you for your service to this country in the United States House of Representatives, but I don't want to be unmindful of your commendable service to the country in the private sector.

Too often, we think that public service only extends to those of us who take their checks from the public, and many of you in the private sector have made the prosperity possible which has made it so pleasant to be an American in recent -- well, forever -- because our system has provided an opportunity base for individuals to achieve in accordance with the talent God has given them.

I want to talk to you a little bit about some trade issues. In particular, I have been hearing a lot back in my home state about the issue of trade enforcement. And my goal for U.S. trade relations -- and in particular, we have been focused on China recently -- is to ensure that Missouri workers and farmers and ranchers and businesses will indeed benefit from trade agreements we reach. That's been my goal around the globe. That's not just focused on China, but of course our recent discussions about China have highlighted the way in which that would play out as it relates to the nation of China.

I've talked with a lot of Missourians about China's bid to join the WTO, and frankly, they are in many respects pleased with the administration's negotiation of the November 1999 bilateral agreement on everything from manufactured parts, automobiles, agriculture. Missourians want to embrace the opportunities that the agreement could afford. But I'd like to go over a couple of issues with you.

As a result of my concern about China's record in living up to agreements in the past, back in April, Secretary Daley testified before this committee, and I raised my concerns about trade enforcement and rather thoroughly discussed them with him. The secretary told me in response to those concerns he had set up in the Department of Commerce a, quote, "China Compliance and Enforcement Initiative." Would you mind commenting on the development of this initiative in relation to the concerns that I've raised, and just giving a very brief thumbnail of how you would see that continuing in your administration?

MR. MINETA: Senator, I do intend to continue what Secretary Daley has laid out in terms of that China compliance effort. It includes also putting, as I recall, a person in China in terms of having someone on site. My -- again, because of the nature of the district that I represented, high-tech Silicon Valley, I recall in 1995 taking a trip with Chairman Hyde as it related to intellectual property rights. And one of the big problems, really, involving intellectual property rights -- and it, I think, extends also to manufactured goods -- is the area of compliance and enforcement. So, seeing what is happening in Japan, Korea, China, at least as a result of that trip, and knowing what the department is doing, I fully intend to make sure that that unit is an effective unit and that it deals with the area of compliance and enforcement relating to our trade agreements.

SEN. ASHCROFT: Well, Secretary Daley had communicated to me, in a document -- there was a fact sheet that outlined the staffing and other things. Would it be your view that you would likely follow that guideline and --

MR. MINETA: Yes, sir.

SEN. ASHCROFT: Thank you.

The second issue I want to address is a little broader than China. And frankly, I have a China trade enforcement bill called the Show-Me Act, but the principles in the bill apply to all countries that are members of the WTO. And I'll be looking for ways to raise the issues in my bill in the context of the PNTR debate, but if I can get a commitment from the administration that you would pursue these principles of enforcement in a broader context in the WTO, then I think that would be more appropriate than simply focusing on China.

And the point is this. It's my belief that the U.S. has lost a measure of its leverage or its enforcement capacity in the WTO to get actual implementation of cases that we have won in the WTO. That we frequently will litigate an offense against the United States or its businesses in the context of the dispute resolution mechanisms provided for in WTO, we get the decision, but the enforcement measures provided for as a result of the decision don't really get us compliance.

So that the decision-making process ends up in sort of authorizing continued noncompliance upon the payment of a certain fee, which is the fine or the penalty. So that in my judgment, in many respects the WTO has become a way to license noncompliance by paying a fee rather than to enforce compliance.

And I think one of the problems that exists here is that the standards for leverage or retaliation or response to noncompliance, once determined in the setting of dispute resolution, the standards have changed. And I can provide copies of these standards, but I'm sure you have them already.

In 1947, the standard was that you had response or leverage or retaliation "appropriate in the circumstances to achieve the objective," the objective being the purpose of the free trade or access to the market or to make sure that the agreement was in force. And under the GATT 1947, Article 23, Paragraph 2, it authorized "suspension of such concessions or other obligations under this agreement as they determine to be appropriate in the circumstances," close quote. And GATT case law says this standard must be liberal enough, quote, "to achieve the objective."

Now, in 1994, under the WTO, the standard for enforcement was changed, and it was a standard that was "equivalent to the level of nullification or impairment." The Dispute Understanding, Article 22- 4, says that the suspension level must be, quote, "equivalent," close quote, to the level of nullification or impairment.

Now, in the U.S.-EU banana case, for example, the equivalency test is strictly interpreted. Now, this 1994 change has affected our rights in Europe -- $120 million over 10 years to try to enforce the beef case we've been trying to enforce, and we still don't have access to the European market for American beef. The banana retaliation was whittled down by the WTO from a $520 million U.S. request down to $191 million situation.

And it seems to me that we need to have robust enforcement for these trade agreements, or else the trade agreements don't really achieve their intended purpose.

I noted that in the Far East, in the not too far distant past, we were able to get compliance by China, in terms of our intellectual property demands, by having robust threats for enforcement. And you're very familiar with their piracy, prevalent piracy at one time, of the intellectual property of the folks from your home district. But we threatened $4.6 billion of retaliation over the last five years to enforce those property rights and, frankly, that's worked. But those are sort of 301 leverage threats which won't be available to us under WTO. As we move from non-WTO status to WTO status, we give up some of our other capacity to determine the level of our own retaliation.

So, without belaboring the question, I would like to invite your ideas about whether you think it might be possible, or whether you think it would be wise to pursue a way for these trade agreements to be enforced -- trade agreements to be enforced in ways that are sufficient to get us to a place of compliance with the agreement, rather than being enforced at a level which provides basically a license that can be purchased with the fine that is a basis for noncompliance.

MR. MINETA: Well, given the standards and the alternative dispute-resolution mechanisms that are in the WTO, again, speaking to your point of enforcement, I'm not that familiar with what -- all of the tools that we have in our kit bag to be able to do that. But I would work with you, as well as others who are interested in this subject matter, to really hone my own ideas in a more positive way and because I'm not really familiar with all of the alternative resolution ways to resolve these differences. But let me look at that and work with you on -- because, to me, compliance and enforcement are very, very important.

SEN. ASHCROFT: Well, I thank you for that assurance. I -- what I was really saying was this: that under the non-WTO framework, we've been successful --

MR. MINETA: I understand.

SEN. ASHCROFT: -- in eliciting compliance. When we had the robust leverage potential of 301 --

MR. MINETA: We don't have that any longer.

SEN. ASHCROFT: -- and if we give that up going into the WTO, which has proved to be a world, at least as it relates to European -- our access to European markets for beef, our access to European markets for fresh fruit, that in each of those cases, it's been notably deficient. And I want to -- really want to have the assurance that the administration cares about the deficiency, recognizes it, and would be eager to work toward improving our ability not just to have some enforcement, which results more in just the perpetuation of the noncompliance, but to have a kind of enforcement that will get us to the place where the agreements we negotiated will be the terms and conditions under which we live.

MR. MINETA: And I can give you that assurance, Senator.

SEN. ASHCROFT: Mr. Chairman, I thank you for giving me the opportunity.

SEN. MCCAIN: Thank you, Senator Ashcroft.

Senator Cleland?

SEN. MAX CLELAND (D-GA): Thank you very much, Mr. Chairman. It's an honor to be with such a distinguished citizen today for our country. And we appreciate your continuation in public service and your willingness to, as Shakespeare said, to take "the slings and arrows of outrageous fortune." And we're glad to be with you today.

Let me just say, being on the Commerce Committee here and seeing the transition from just commerce to e-commerce, I know the FTC gets involved and the FCC gets involved in e-commerce. What do you see as the role of maybe the Commerce Department in the near future in terms of e-commerce? Are there some rules of the road that have applied to commerce in general, especially interstate commerce, for the last, say, hundred years or so that we might want to consider as we look at e-commerce, or is this such a new baby that we'd better take hands off until we see how things progress?

What's your reaction to this whole dramatic growth of e-commerce?

MR. MINETA: Well, I think that -- Senator Cleland -- that the whole issue of e-commerce is really business as we have always seen it but now being done in terms of a different vehicle, I guess you might call it. In the past, I suppose, there was a threat to the local merchant when the U.S. Postal System started having parcel-post delivery and whether or not that merchant felt threatened by their hometown citizen writing to someplace else to get a package. Well essentially, the means today are different; it's electronic.

And so because of that, and because of the speed and the volume that's obviously going to be there, whether it be business to individuals or business to business, or business to government or government to government, what we have to make sure, I think, is accessibility. And we also have to make sure that there is recourse, or some redress, to people who feel shortchanged in terms of the product they bought, what they were anticipating buying, and the product they in fact received. There has to be some redress mechanism there to make sure that those customers are going to have some way to resolve that problem.

This is an area, I think, in which the marketplace is able -- and has functioned in a good way, positive way. But I think what happens is that government can provide the backstop so that we become the safety net, where the businesses are not responding to resolve those conflicts. And I think in those instances, we have seen, whether it be the National Governors Association or others trying to -- or a federal commission, the congressional mandated commission, taking a look at e-commerce in its broadest perspective to see what it is that has to be done, and whether the controversy be sales tax or whatever it is, and be able to let the marketplace, I think to a very great degree, determine where we are, and that we serve as a backstop in being the safety net for the consumers.

SEN. CLELAND: And do you think -- well, there are two issues that this committee is struggling with -- one is the whole issue of privacy, and the other is taxation of the Internet and e-commerce. Ultimately, do you see that maybe government might have some kind of backstop role, some kind of fundamental role, here in maybe guaranteeing privacy or working out some accommodation vis-a-vis Internet taxation?

MR. MINETA: Well, first of all on the privacy issue, there is no question whether it be, let's say, credit-card information or even getting into other things -- medical -- medical information -- how do we protect the privacy of a person's medical -- the prescriptions I take? And yet from a telemedicine perspective, if I am injured in an accident -- obviously, the Georgia roads are too safe and I wouldn't have an accident in Georgia -- (laughter) -- but wherever I might have an accident, I would want that attending physician to be able to have my records here from this area, my doctor.

So, you know, we want to be able to expand the utilization and yet protect the privacy. And I think that is where government does exercise a great deal of -- can exercise a great deal of effort and control.

On the taxation issue, the administration is in opposition to any taxation of the sales that are generated through the Internet. And I think that's, again, something that's going to have to be resolved more by the states. The state laws vary. And until there's a meeting of the mind there at the state level, I don't believe that, as a federal perspective, we ought to jump into that area right now.

SEN. CLELAND: Well, thank you very much. Those are vexing issues, challenging issues for us all. We will be certainly looking to you for your guidance and your continued leadership on these and other issues.

I just want to thank you again for your willingness to serve, and look forward to working with you. You certainly have my support in your confirmation, and I'm proud to see the president nominate you.

Thank you very much.

MR. MINETA: I appreciate that very much, Senator. Thank you.

SEN. MCCAIN: I was reading from an editorial where you said your proudest moment was the 1988 Civil Rights Act, which at least caused the government to apologize for what happened to Japanese Americans in World War II. Is that true?

MR. MINETA: It was a very proud moment, Senator, especially with the 17th of September, 1988, the 200th anniversary -- or 1987, rather, when we took up the bill in the House, which was the 200th anniversary of the signing of the Constitution. So to have that legislation on the 200th anniversary of the signing of the Constitution, I thought was very, very important. It had a great deal of meaning to me.

SEN. MCCAIN: Well, we're all very proud of you for making it happen.

We look forward -- I think, I know I speak for Senator Hollings and, I believe, the entire committee -- we look forward to attending your swearing-in ceremony, if you will invite us. (Laughter.) MR. MINETA: Absolutely. Absolutely.

SEN. MCCAIN: This hearing is adjourned.

MR. MINETA: Thank you very much, Mr. Chairman. (Applause.)

END

LOAD-DATE: July 20, 2000

Document 6 of 124.


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