WASHINGTON : Bill Would Remake Commerce Department in Japanese Image

CATHERINE COLLINS is a Washington writer

An ambitious legislative package proposed by Sen. John Glenn (D-Ohio) would sculpt and prune the U.S. Department of Commerce like a Japanese bonsai.

Obviously, Glenn has been studying the competition.

"I have become convinced that one of the sources of this nation's competitiveness problem is that the structural organization and function of some of the federal government's key agencies are simply out of step with the dramatic changes which have occurred in the American economy in the last decade," said Glenn, who is chairman of the Senate Governmental Affairs Committee. The committee recently held hearings on the trade and technology promotion act (S. 1978).

Two years ago, Congress passed the Omnibus Trade and Competitiveness Act, which provided leverage for U.S. negotiators trying to break down international trade barriers. The trade and technology act would facilitate the next step.

As trade barriers are removed, Glenn's bill would allow American business to take advantage of the expanded opportunities by backing new research efforts and creating a more aggressive federal agency to promote the results.

"It properly identifies economic strength based on international competitiveness as a key ingredient of our future national security in an increasingly interdependent world," Bruce Smart, senior counselor at the World Resources Institute, told Glenn's committee.

The bill would alter the federal structure responsible for promoting U.S. trade and technology by:

* Reorganizing the Commerce Department and renaming it the Department of Industry and Technology.

* Establishing a civilian counterpart to the Defense Advanced Research Projects Agency (DARPA) that would be called the Advanced Civilian Technology Agency (ACTA). It would provide seed money for high-risk, long-term generic research.

* Placing economic Cabinet members on the National Security Council.

* Elevating the science adviser to the president to equal status with the national security adviser.

The Senate Governmental Affairs Committee recently completed hearings on the measure.

Supporters of the legislation include Sens. Lloyd Bentsen (D-Tex.), chairman of the Finance Committee; Edward Kennedy (D-Mass.), chairman of the Labor and Human Resources Committee, and Donald Riegle (D-Mich.), chairman of the Banking Committee.

House Majority Leader Richard Gephardt (D-Mo.), has sponsored similar legislation.

Measures Would Track Foreign Investment

It's an oldie that may still hit the Top 40.

Like a handful of representatives before them, Sen. Jim Exon (D-Neb.) and Rep. Norman Lent (R-N.Y.) have introduced companion bills to monitor foreign investment. Whatever is passed would be called the Foreign Investment Analysis Act.

The theory is that better information about who owns what in this country would allow the government to develop better economic policies.

For 15 years, various congressmen have beat the drum for a mechanism to track foreign investment, and a hodgepodge of laws has been passed. But it's still easy to conceal foreign ownership and difficult to know how large it is.

This proposal is different because it has White House support.

The measure would give the Bureau of Economic Analysis access to confidential Census Bureau information. Currently, it only collects and analyzes information about foreign parent companies. It cannot gather data about operations controlled by those companies in the United States. The Census Bureau collects detailed information, but it's confidential. Not even Congress can get it.

"The Foreign Investment Analysis Act of 1990 is a constructive addition to the debate on the role that foreign ownership should play in the U.S. economy," Exon said.

"Some suggest that Americans should simply be grateful for their jobs at foreign-owned businesses. I say that jobs are not enough. American economic policy must also be concerned about the creation of American wealth. America must ask itself if its current economic policies are the equivalent of eating the seed corn of future prosperity."

The act has been referred to the Senate Commerce Committee and the House Energy and Commerce Committee.

Although the bills were introduced at the request of the Bush Administration, opponents of previous efforts may resurface. Earlier measures have drawn heavy opposition from foreign- and U.S.-owned corporations.

Ex-Trade Negotiator Launches Think Tank

With the world's military alliances shifting in unprecedented fashion, many new definitions are popping up for the term "national security."

Clyde V. Prestowitz Jr., author of an influential book on trade policy, "Trading Places: How We Allowed Japan to Take the Lead," and a former Reagan Administration trade negotiator, thinks that the definition is shifting from military terms to economic ones as the United States faces what he calls "unprecedented challenges without the benefit of past superiority in industry, technology and finance."

To help formulate the responses required by this changing focus, Prestowitz has formed a Washington think tank, the Economic Strategy Institute. The organization held its kickoff dinner recently and drew some impressive supporters, including Gephardt and Senate Minority Leader Robert Dole (R-Kan.). As expected, there were also plenty of leaders from labor unions and high-tech companies, such as TRW Inc.

While the global swarming of Japan and other Pacific Rim countries has become almost passe in economic circles, Prestowitz is departing from the old agenda to take on the issue of lagging U.S. international competitiveness. The institute will try to define the nation's economic strategy by examining the interlocking global and domestic factors behind some of the country's economic woes.

Prestowitz, the institute's president, was a controversial figure while with the Commerce Department because he advocated a tougher trade stance toward Japan. The institute's executive vice president, Ronald A. Morse, was among the first Americans to question Japan's attempt to influence U.S. policy through paid lobbyists.

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