Smith to Introduce Amendment to End Clinton Grain Embargo

Jun 17, 1998

WASHINGTON, D.C. -- At a hearing today of the House Agriculture Committee, Chairman Bob Smith (R-OR) announced his intention to introduce an amendment to the Selective Embargoes Act (H.R. 3654) to exempt credit, credit guarantees, and other financial assistance for the provision of food or agricultural commodities from sanctions under the Arms Export Control Act.

Following the detonation of nuclear devices by Pakistan and India in May, President Clinton called for wide-ranging sanctions as mandated under Section 102 of the Arms Export Control Act. However, there is disagreement within Clinton's cabinet as to whether GSM credits, which are used solely for agricultural exports, are exempt from the sanctions.

On May 29, Chairman Smith and Ranking Committee Member Charlie Stenholm (D-TX) sent a letter to President Clinton urging him to recognize that Congress intended GSM credit guarantees to be outside the scope of the Arms Export Control Act. The President did not respond to the Chairman's letter and his failure to make a decision regarding this issue has effectively led to an embargo on one of the largest wheat markets for American farmers.

Today, Chairman Smith announced he would take action to end the Clinton grain embargo by introducing an amendment to the Selective Embargoes Act (H.R. 3654) which will be considered by the Agriculture Committee tomorrow. H.R. 3654, sponsored by Representative Tom Ewing (R-IL) would require Congressional approval if the President imposes an agriculture specific embargo on a foreign country. Smith's amendment would explicitly exempt from the Arms Export Control Act credit, credit guarantees, and other financial assistance for the purchase or provision of food or agricultural commodities.

"While I strongly believe that Section 102 of the Arms Export Control Act does not apply to USDA credit guarantee programs, I have come to the conclusion that the Committee must act because of the uncertainty placed on the U.S. wheat market," Smith said.

"U.S. agriculture remembers the 1980 Soviet grain embargo. The one lasting impression left by that embargo is that the U.S. could not be considered to be a reliable supplier of wheat. The past 18 years have been spent attempting to reverse that opinion," Smith said.

"U.S. farmers and ranchers, since the passage of the Freedom to Farm Act, look to the marketplace to sell their product. It is the responsibility of the U.S. government to make sure that there are no artificial impediments in the way of agriculture sales. This means that our government must work to eliminate unfair trade practices around the world and must not erect barriers of its own, such as sanctions and embargoes, actions that limit the competitiveness of our farmers and ranchers," Smith said.

Smith represents Oregon's Second Congressional District — which includes most of eastern, southern, and central Oregon -- in the U.S. House of Representatives.

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