FOR IMMEDIATE RELEASE, Contact: (202) 225-3625
June 26, 1998
No. FC-29A
Congressman Bill Archer (R-TX), Chairman of the Committee on Ways and Means, today announced that on Thursday, June 25, 1998, the Committee ordered favorably reported, as amended, H.R. 3249, the "Federal Retirement Coverage Corrections Act," by voice vote; and ordered adversely reported, H.J. Res. 120, a joint resolution disapproving the extension of the waiver authority contained in section 402(c) of the Trade Act of 1974 with respect to Vietnam, by voice vote; and H.J. Res. 121, a joint resolution disapproving the extension of most-favored-nation (MFN) treatment to the products of the People's Republic of China, by voice vote.
BACKGROUND ON H.R. 3249:
H.R. 3249, the "Federal Retirement Coverage Corrections Act," would correct errors in the retirement plan misclassification of Federal employees and was ordered reported by the House Committee on Government Reform and Oversight on March 5, 1998.
DESCRIPTION OF H.R. 3249, AS APPROVED:
The revenue provisions would provide that: (1) retirement plans would not lose their "qualified" Federal tax status by making the corrections required by H.R. 3249, (2) participants whose retirement accounts are adjusted in accordance with H.R. 3249 would not incur Federal income tax liability, and (3) amounts transferred in accordance with H.R. 3249 would not be subject to employment taxes.
The Social Security provisions would provide that: (1) retroactive earnings would be credited and the Social Security Trust Funds would be made whole in situations where individuals change to one of the retirement systems that provides Social Security coverage, (2) necessary conforming changes would be made to the coverage provisions of the Social Security Act, and (3) the Commissioner of Social Security would have the authority to receive necessary information from agencies, notify the Secretary of the Treasury to transfer taxes paid as a result of elections under H.R. 3249 to the Social Security Trust Funds, and to correct earnings records.
BACKGROUND ON H.J. RES. 120:
Since the early 1990s, the United States has taken gradual steps to improve relations with Vietnam. In February 1994, President Clinton lifted the trade embargo on Vietnam in recognition of the progress made in accounting for prisoners of war and missing-in-action and the successful implementation of the Paris Peace Accords. The United States opened a Liaison Office in Hanoi later that year. On July 11, 1995, President Clinton announced the establishment of diplomatic relations, which was followed by the appointment of former Member of Congress Douglas "Pete" Peterson as U.S. Ambassador to Vietnam.
The Administration has also taken steps toward the normalization of U.S. trade relations with Vietnam. At present, Vietnam's trade status is subject to the Jackson-Vanik amendment to Title IV of the Trade Act of 1974. This provision of law governs the extension of MFN, or normal, tariff treatment, as well as access to U.S. Government credits, or credit or investment guarantees, to nonmarket economy countries ineligible for MFN treatment as of the enactment of the Trade Act. A country subject to the provision is eligible for coverage by U.S. trade financing programs only if it is certified by the President as complying with the freedom of emigration provisions under the Act or if the President waives this requirement. Specifically, the Act authorizes the President to waive the requirements for full compliance with respect to a particular country if he determines that such a waiver will substantially promote the freedom of emigration provisions, and if he has received assurances that the emigration practices of the country will lead substantially to the achievement of those objectives. This determination is subject to a resolution of disapproval by Congress. In addition to the freedom of emigration requirements, the extension of MFN tariff treatment is subject to the conclusion and approval by Congress of a bilateral commercial agreement with the United States providing for reciprocal nondiscriminatory treatment.
On March 9, 1998, the President issued a waiver from the Jackson-Vanik freedom of emigration requirements for Vietnam. Vietnam is still negotiating a bilateral commercial agreement with the United States, because it is currently ineligible to receive MFN tariff treatment. The President's waiver for Vietnam, however, gives that country access to U.S. Government credits, or credit or investment guarantees, such as those provided by the Overseas Private Investment Corporation, the Export-Import Bank, and the U.S. Department of Agriculture, provided that Vietnam meets the relevant program criteria. The President's waiver expires on July 3, 1998. The renewal procedure under the Trade Act requires the President to submit to Congress a recommendation for a 12-month extension no later than 30 days prior to the waiver's expiration (i.e., by not later than June 3). On June 3, 1998, the President issued his determination to waive the requirements for Vietnam for the period of July 3, 1998, to July 2, 1999. The waiver authority continues in effect unless disapproved by Congress within 60 calendar days after the expiration of the existing waiver. The Committee on Ways and Means is subject to a discharge motion if it does not report a resolution of disapproval within 30 calendar days of its introduction. The resolution, which is highly privileged on the floor may not be amended except to change country names.
DESCRIPTION OF H.J. RES. 120:
H.J. Res. 120 was introduced by Congressman Rohrabacher (R-CA) on June 4, 1998. H.J. Res. 120 states that Congress does not approve the extension of the authority contained in section 402(c) of the Trade Act of 1974 as recommended by the President to Congress on June 3, 1998, with respect to Vietnam. The effect of this resolution would be to withdraw the President's waiver of the Jackson/Vanik amendment for Vietnam.
BACKGROUND ON H.J. RES 121:
The Jackson-Vanik amendment, described above with respect to Committee action on the waiver for Vietnam, governs extensions of MFN, or normal, trade relations with the People's Republic of China. China signed a commercial trade agreement with the United States, and normal trade status, was first granted to China on February 1, 1980, and has been extended annually since that time. The President announced on June 3, 1998, his intention to waive the freedom of emigration requirements for another year, beginning on July 3, 1998.
DESCRIPTION OF H.J. RES. 121:
H.J. Res. 121 was introduced by Congressman Solomon on June 4, 1998. H.J. Res. 121 states that Congress does not approve extension of the waiver authority contained in section 402(c) of the Trade Act of 1974, as recommended to the Congress by the President on June 3, 1998, with respect to the People's Republic of China. The effect of this resolution would be to withdraw MFN treatment to the products of China.