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The Commerce Dept. Has A Choice: `Reinvent Or Die'


Washington Outlook

THE COMMERCE DEPT. HAS A CHOICE: `REINVENT OR DIE'

Don't turn off the lights at the Commerce Dept. just yet. True, Commerce in its present form is probably a goner. Republican budget hawks in both houses have targeted the $4.2 billion-a-year agency for the ax. But a rearguard effort to turn Commerce into a lean, mean trade agency is quietly gathering steam with GOP moderates on Capitol Hill and in corporate boardrooms.

For now, Commerce Secretary Ronald H. Brown is sticking publicly to an "all or nothing" strategy. But on June 21, Deputy Secretary David J. Barram told 25 top department officials to start planning for a 30% budget cut. Faced with intense political and public support for downsizing, "it's reinvent or die," says a top Administration official.

LOSING A VOICE. Business is finally realizing that life without Commerce may be tough if the agency's trade-promotion programs are eliminated. "The governments of Japan, Britain, France, Italy...aggressively support their businesses overseas," says Thomas S. Norwalk, president of Miami Valley Marketing Group Inc., a small-business export consulting firm. "We need the same support from our government to keep the playing field level."

And business is aghast that it may lose its Cabinet voice. "When major decisions are made--about trade embargoes or participation in trading arrangements--it is essential that U.S. manufacturing interests be represented," says National Association of Manufacturers Vice-President Howard Lewis III.

Such sentiments are fueling a move to salvage trade functions from the Commerce wreckage. It won't be easy. Budget-busters deride such programs as corporate welfare, but GOP moderates view them as vital. On June 19, Senator Christopher S. "Kit" Bond (R-Mo.) unveiled plans to create an International Trade Dept. out of Commerce's International Trade Administration and Bureau of Export Administration. "Trade is the key to our economy's future," says Bond. "If we toss in the towel right now, we can give up on the hope of remaining the world's most important economy."

In fact, business wants something grander: a Cabinet-level agency to oversee all federal export-promotion entities, including non-Commerce units, such as the Office of the U.S. Trade Representative and the Export-Import Bank. That idea of mimicking Japan's Ministry of International Trade & Industry has support from Senate Governmental Affairs Committee Chairman William V. Roth Jr. (R-Del.) and Representative Harold Rogers (R-Ky.), who chairs a House subcommittee that oversees Commerce.

But such ambitious schemes are probably pipe dreams. For one, U.S. Trade Representative Mickey Kantor opposes any merger with Commerce. In a June 15 letter, he argued that the USTR "currently benefits enormously from its small size and ability to shift resources quickly to pressing negotiations." And few believe a new Cabinet-level agency can be created in the current budget-cutting frenzy.

So Brown will have to act. Indeed, on June 14, a day after Clinton unveiled his 10-year deficit-reduction plan, Vice-President Al Gore and key staffers met to discuss ways to reinvent Commerce. Dismantling the agency entirely could save $7 billion over five years, the GOP says. The likely outcome? Chunks of the department, such as the Weather Service and Census Bureau, will be moved to other agencies, privatized, or killed. Existing trade, technology, and economic analysis units will live on in a smaller agency, perhaps under a new name. So Commerce's home, the Herbert C. Hoover Building, may survive after all--as the Ron Brown Trade Center.EDITED BY DOUGLAS HARBRECHT By Amy Borrus


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