The President. Sit down, please, and welcome, welcome. Let me just make a couple of comments and then try, with the assistance of our able Secretary of Agriculture, my friend and yours, too, Ed Madigan, to respond to your questions.
But in the first place, I'm delighted that Ed is here. I was very high on Clayton Yeutter -- moved over to a new and very difficult and very different assignment. Ed stepped into the breach. He's doing a fantastic job for our country. And I understand that he's rapidly making believers out of those in ag business that didn't know him. Those that did I think already were believers, as I have been.
But anyway, we are the most agriculturally productive nation the world has ever known. And I want to be sure that we continue to be that. I'm still convinced that we can compete with anybody, provided we remove some of the barriers to trade. And that's one of the reasons that the Secretary and I are as committed to the successful conclusion of the GATT round; also why I believe that a Mexico free trade agreement would be in our own best interests.
As a matter of fact, we've got a new one with Canada. It's been in effect for 2 years, and agricultural exports have gone up by 35 percent. So, those that want to criticize ought to take a look at the reality, and I think then they'd understand why we are committed -- because we think it's good for American agriculture as well as good for -- I think it's good for jobs, too. Just across the labor frontier there.
There are three important trade agreements. You're all familiar with them. The Uruguay round -- the GATT talks; the trade component of our Enterprise for the Americas Initiative, which is, I think, a bold new program that must succeed in terms of helping these democracies -- fledgling democracies, many of them -- in South America and thus building new markets for our own goods. But in any event, that's the second one. And then the third one, of course, is the North American free trade agreement that I mentioned earlier that, in this instance, features Mexico.
Now, there are some questions about whether these would be of benefit to the American farmers. Let me just give you a couple -- click off a couple of little numbers here. Free trade in North America would give our farmers a freely accessible market of 365 million people with a GNP of trillion. And that's a market that's larger than the European Community. And likewise, the negotiation of a successful GATT agreement would decrease the trade barriers worldwide, offering potentially unlimited export opportunities.
We're not there yet. We've had some difficulties getting our friends in Europe -- and they are friends -- to understand this. But the Secretary and I and our USTR, Ambassador Carla Hills, and the Secretary of the Treasury and the Secretary of Commerce -- all of us are working on this important agreement. But we think that it would be a boon to American agriculture when we're successful.
The success, obviously, hinges on what you know and I know as Fast Track negotiating authority. It is simply not right to -- you can't negotiate an agreement if the people you're negotiating with think that it will be amended in many, many ways. The Congress will, though -- there's a misunderstanding because some think that when we ask for Fast Track, that we're asking Congress to yield their right to vote on it. And that simply isn't -- I found that hard to believe, but I think there's been some confusion on that. We are going to -- they obviously would vote up and down. And if they didn't like it, they'd vote it down. If they liked it, they'd vote for it. But you can't have 25,000 amendments to an agreement and expect your trading partners to negotiate seriously.
So, the Congress -- and I'm very respectful of Congress' role in this. They have a constitutional role on international trade, and some forget that. So, we're sensitive to that role. We've had extensive consultations. I don't believe I've seen an initiative that's had more consultation with Congress than this one. And I think we're going to be all right on it, but we're going to continue to work very hard to get Fast Track approval.
New applications for agricultural products, like the alternative fuels, fuels blended with ethanol, and biodegradable plastics, and some not so modern uses like food and clothing, provide farmers with exciting opportunities. I understand that there's some differences in the ag community. I was just talking to the Secretary about this. But generally speaking, we're committed to alternative fuels. I believe that the Clean Air Act alone is going to create tremendous opportunities for alternative fuel. So I haven't lost my enthusiasm for this at all.
The Fast Track assures our trading partners that we will go through with our agreement. We will vote on what they and we negotiate, and I mentioned that point earlier. New applications for agricultural products is important. And we're talking about some fuels blended with ethanol and biodegradable plastics. And all of these kinds of things I think have a brilliant future for agriculture. It's been a little slower than I had hoped, frankly, but I think there's a big market and big future out there.
And so I would say to farmers, do not despair because you haven't yet reached the full potential of these new markets for your products.
I'm going to be asking agriculture over and over again for support on this Fast Track extension, and I think that the bottom line is, they will enjoy more export opportunity if we're successful here. And I think it will be a boon for the rural economy as well as -- well, obviously it would if we continue to sell more abroad. So, these were just a couple of the points, and now I'd be glad to respond to some questions.
Q. Mr. President, on behalf of NAFB, we appreciate this time on your schedule. As president of the organization here in 1991, I'd like to defer the first question to the elder statesman of our group from Des Moines, Iowa, a gentleman who was our second president in 1946, Herb Plambeck.
The President. Is that right? Herb, you didn't tell me all that. Thank you, Ron, and I'm just delighted you are here, really.
Trade With Iraq
Q. Mr. President, I'm sure I speak for everyone here in our group when I voice the pride and the gratitude we have toward you for the way the Persian Gulf crisis was handled and the humanitarian efforts that have been made since then.
There are, however, a few questions remaining. One relates to Iraq having been one of our good customers for our farm products. Is any thought being given already toward the restoration of this trade?
The President. The restoration of food support for Iraq is underway, the United Nations having taken some steps. We are not going to let people starve. But in terms of building reliable markets and in terms of trying to have normalized trade, the United States will not have normalized trade as long as Saddam Hussein is in power.
Food is an exception now, because we're not going to let people starve. We are going to go forward with helping people in Iraq without regard to what sect they're from or anything of that nature. But I don't want to mislead any farmer in this country. We will not have normalized trade with Iraq as long as Saddam Hussein is in office. And they're now trying to appeal to get some relief on the oil. There's not going to be any relief as far as the United States goes until they move forward on a lot of fronts, incidentally. I mean, what's happened to these Kurds is absolutely -- it's so sad you're just moved.
Frankly -- and Herb, I'm glad you mentioned it -- we have responded. We responded from day one, and now we're responding to enormous -- hundreds of millions of dollars relief. That's what we do. We're Americans. We do that to help people. But we're not going to have normalized relations with this man.
Credit for the Soviet Union
Q. Mr. President, have you made a decision on granting the Soviet Union more credit?
The President. No, and we're thinking about that. The legislation -- I've talked to Ed about this, and the legislation is fairly specific in terms of creditworthiness. Shake me off if I'm wrong here, Ed, but I think that's correct. Regrettably, the Soviet Union has not entered into the market reforms that I think Gorbachev aspires to and that I know that the President of the Republic, Mr. Yeltsin, aspires to. So, they've got to move forward to be creditworthy if we're going to do this.
Now, there may be -- and we're thinking about this -- there may be some way to extend credits. And I'll tell you another problem is we want to be sure how it's distributed -- that no area is precluded from being the beneficiaries of this kind of credit. So, it's up in the air right now. I don't want to say that I won't go forward with this. I think in some areas it would be very helpful to us, to our grain growers.
I'm not immune to the fact that they've been hurting, so I'd like to be helpful. But I've got to abide by the law. And if we can find ways to encourage forward movement on these credits or find ways to make it creditworthy any other way, so much -- market reform is a good way to do it. There are other ways that perhaps they could make the credit more secure.
Fast Track Authority Legislation
Q. Sir, I'd like to get back to Fast Track. Only one of the major farm organizations, and they're a glaring example -- everybody else is in favor of the Fast Track. What's the hangup? What's the problem? What do you see?
The President. Problem with who? With that one guy that's out of step, or the other 51? [Laughter] I'm for the 51 farm organizations that are for it. Fifty-one are.
Q. Don't you feel it will pass?
The President. Well, I hope so, but we're not going to act like it's done yet. We are killing ourselves trying to get this done, and we are going to continue to work with the Democrats in the Congress -- Republicans. Incidentally, we're approaching this in a nonpartisan manner. We've got some Republicans that I still have to convince, and plenty of Democrats. And then we've got plenty of Democrats that are for us and plenty of Republicans. And Ed's not approaching it in a partisan manner.
But in terms of the farm organizations, thank heavens most of them are seeing that it will benefit the agricultural economy in this country. I really believe it will. But we're just going to keep pursuing it because I don't want to say it's in the bag. It isn't yet. We're counting votes, but we've got a ways to go before I can say to the American farmer, look, we're going to win this one, and you're going to be the beneficiaries thereof.
Q. The President, how successful -- or what would it mean not only to the U.S. as a whole but for the U.S. farmer for a successful GATT agreement? And how important is Fast Track to that?
The President. It's very important to a successful conclusion to the GATT round. Without it, without Fast Track, I think it would be almost impossible to hammer out an agreement that would pass muster with the many countries that have to be in accord. And so it's do or die, in a sense, that this Fast Track -- some have wanted to try to split them off, split off Mexican -- the North American free trade from Fast Track and relating to Europe -- to GATT, I mean. And I don't want that. I don't want to see a policy that discriminates against a neighbor of ours. And so, we're going to go forward. And I -- again back to Bill's question -- I think we can do it, but we're not there yet.
Mexican Adherence to Pesticide Regulations
Q. One of the problems it seems like that Congress and some agricultural interests need assurances on is the pesticide regulation issue. What kind of assurances can you provide that we can get Mexico to conform to our strict pesticide regulations here?
The President. Well, there's a lot of discussion going on with them. It has to do with the other environmental concerns, too. I believe that Mexico -- and the technical way we're doing this I'd have to defer -- even maybe Ed could answer it, but I'd have to defer to Carla. I'm not sure. I have discussed at length the environmental concerns here with the President of Mexico. And all I can tell you is that he has moved forward. He's already shut down or is in the process of shutting down the highest polluting refinery in Mexico. It's the PEMEX refinery. He is well aware of the environmental concerns in this country, and he shares them as far as Mexico.
I'll give you an example. When I first met -- maybe not the first meeting but early-on meeting with President Salinas, who's a good man -- and he started telling me about the children in the Mexican schools. They paint the sky at night with no stars. Imagine that -- a school child painting the sky gray. He said, ``My ambition is to have the children paint the night with the stars and the moon so they can see it.'' And I am convinced that he is going to do what is reasonable and what he should do to protect his environment, just as we're trying hard to do it on ours.
So, in terms of this, I'm embarrassed to say I can't give you the technical language as to what we might be doing right now on agricultural pesticide use, pesticide use in agriculture, but I am confident -- and incidentally, the Senators tell me that they are confident that the environmental questions can be readily answered.
Ed, do you want to add anything?
Secretary Madigan. You covered it very well.
The President. I mean, it's more general than you wanted, but I am satisfied we can get it done.
Q. You mentioned the commitment to alternative fuels, and I think wheat and corn producers realize that commitment came long before the Persian Gulf war. But haven't the events of the last few months reemphasized our need to get away from those foreign fuels?
The President. Getting away from this much reliance on foreign oil has been there for a long, long time. It's more clear today because of the Gulf. We must learn. And one of the things that we are trying to do with our whole new national energy program is to become less dependent on foreign oil. Now, one way to do that is through alternative fuels.
We also, I want to say -- and I hope I don't sound defensive -- do have some pretty good ideas in terms of conservation. And we're accused of not having any conservation ideas or conservation program -- and we want it. But I also don't want this country to be shoved into a no-growth mode. I mean, there's a lot of young people that need economic opportunity in this country, a lot of farmers that can sell more if the market increases for their products. But you put your finger on something I feel strongly about, and that is that we must, from our national security standpoint, become less dependent on foreign oil. And alternative fuels is one good way to do it.
I happen to think another way to do it is to expand our exploration domestically. And you run into conflict with special interests groups on that, but I am convinced that that is in our national security interests, too.
Federal Emergency Assistance for Kansas
Q. Mr. President, any decision on Federal assistance for the tornado victims?
The President. I'm glad you asked about that one because one of the reasons I kept you all waiting a little bit is I just signed the disaster assistance for Kansas -- and I expect, as the other requests come in, they will be processed that rapidly. I mentioned yesterday coming out of church that our hearts really go out to the victims. Bob Dole was out there the night before last in Kansas, and he called me up, I think it was Friday night -- or Saturday night I guess he got back -- and said he really had never seen anything like this. And of course, it was widely covered on the television.
And I said, ``Bob, what more do we need to be doing?'' He said, ``Well, the FEMA emergency people are there now.'' And then, of course, then in came the formal request. And I'm happy to say that we did sign that right now, and we'll do what's necessary for other States.
Q. Mr. President, what about most-favored-nation status for China?
The President. Well, Mike, it's a difficult one. What I have tried to do with China is to make clear our concern about human rights abuses, stemming out of -- highlighted particularly by Tiananmen Square, but recognize that cutting off all contacts or trying to drive them to their knees economically is not the way to effect change. And I go back to when we opened relations with China. And, yes, there's some abuses there that no American can be tolerant of. But there's a lot of changes in China that have taken place that are beneficial.
And I would point to the fact that our policy of at least trying to keep some reasoned relation with China paid off in spades on the recent war, because we needed -- I felt we needed -- the international sanction that those United Nations gave the effort. And if we'd have had enmity with China, it is very clear in my mind that they might -- I can't say would have, but they might well have vetoed the resolutions. And we operated with an international sanction, an international approval that gave the whole operation worldwide credibility.
So, I think it's important that we have reasonable relations with China. I think it's important we have trade relations with China. But on the other hand, China sometimes doesn't see eye-to-eye with us on some of the fundamental human rights questions that concern me as President and concern all Americans.
So, that's a long way of saying I don't know exactly what we're going to do on the MFN to China. We fought for it last year. We have protected the students in this country, Chinese students -- will continue to do that. But I'm one who believes that if we can keep contact and keep showing them our way, showing them how good our product is, that that's a better way than breaking off relations.
There's a billion -- what, 1.1 billion people in China. And give them their due, they're feeding 1.1 billion people. I wish our trade balance with China was better. It's gone more in their favor. But again, we can't legislate that. But I think I understand China. I note the importance of China. I respect the sovereignty of China. I've said over and over again, I wish that -- I have not certainly approved, indeed, have condemned some of the human rights abuses.
So, we've got to work with this big country. And it is in our interest so to do. Whether that will lead to MFN renewal, that question will be decided very soon. And I, myself, must decide what role the administration will take, because we had a battle on it before, as you know.
Two more -- there are two persistent hands up, and then we'll go. Yes?
Q. Your reaction to the instability shown last week, of Gorbachev resigning and then the Communist Committee not taking it. What would him stepping down mean to U.S. agriculture?
The President. Well, I think it would mean uncertainty inside the Soviet Union. And there's a lot of question as to something -- if Mr. Gorbachev stepped down, which way the Soviet Union would go. I like to feel that the changes manifested by the lightening up in Eastern Europe and by much more openness, glasnost, inside is irreversible. I like to believe that. But that is an internal matter of the Soviet Union. I have elected to stay in close touch with Mr. Gorbachev. He is the man there right now. We meet with opposition leaders from time to time at various levels, including mine with the Baltic leaders. We have differences with them in terms of, well, treatment of the Republics, for example, right now.
But what happened last week I think in a sense was quite reassuring because there were some widespread speculation that Mr. Gorbachev was in trouble, even with the party. And I think that showed that that was not the case.
But, again, there's a lot of turmoil there. And there's a lot of economic difficulty in the Soviet Union today. And we don't take joy in that at all. We don't take joy in their problems. They've moved considerably since -- on a lot of things. And, again, going back to the war, the answer I gave you on China is very valid in terms of the Soviet Union. They approved every resolution. They stayed with us, even when Gorbachev -- you remember just before the ground war started -- was talking about, well, please hold off. But I didn't take that as a disapproval of what we were trying to do. Indeed, when we said, okay, it's Saturday, Mr. Saddam Hussein, or you've got problems -- the Soviets, having tried their approach, were supportive.
And so again, we want to keep good relations, but they have enormous -- just enormous -- problems, and we take no joy in that at all. I'd like to find ways to be helpful. But when it comes to these credits, we cannot -- we are bound by our laws. And I think that protects the American taxpayers -- that there has to be a certain creditworthiness. So, it's a tough one right now for them, but let's hope that this democratic process will keep going and keep evolving until we have just pluperfectly good relations with them. I mean, we've got good relations, but they've got such enormous problems that their full potential is unrealized.
You talk about energy -- somebody asked me the energy question -- the potential is enormous. But they've got to move forward with more than rhetoric. They've got to go with these market reforms.
Free and Fair Trade
Q. Mr. President, there's been a lot of talk about tariffication. One of those places where it has happened -- Japan has removed quotas and put on tariffs on beef. Could you relate to that, please?
The President. What was the word?
Q. Tariffication -- putting tariffs on instead of quotas in trade negotiations. That's been one of the goals.
The President. I don't think just substituting one barrier for another, if that's what the question is, is a good way to do it. We're trying to get open markets. It is my fundamental belief that the American farmer can compete with anybody provided we're talking total freedom of trade. We're not there yet. We're not there yet in terms of trade with a lot of countries -- put it that way. But if the substitution is being substituted to throw up a barrier under a different name, I don't think we should be very enthusiastic about that approach.
Maybe I'm missing your question, but -- --
Q. The question is, as opposed to just a strict quota, put on a tariff -- and that's been one of the things that have been talked about in trade negotiations, that has happened, and apparently beef exports to Japan have increased.
The President. Can I refer to my economic expert to answer that which I do not know? [Laughter] Mike? This is Dr. Mike Boskin here.
Chairman Boskin. We have been generally in favor of substituting tariffs for quotas in the context of reducing the tariffs in a variety of ways. So, I think the President's quite right -- you don't want to just substitute one form of barrier for another. That won't help us. That won't help our exporters. But it's being done, and the discussions of it will continue -- discussion of it in the Uruguay round and elsewhere is a process of getting the tariffs removed. So, you start by getting rid of the quotas and putting on a tariff with a schedule for the tariff to decline.
The President. That's what I wanted to say, but I was just kind of hung up on it. Thank you all very much.
Q. I just wanted to say thank you, and we appreciate your access to talk about agriculture for a few moments.
The President. Thank you all very much.
Note: The President spoke at 2:35 p.m. in the Roosevelt Room at the White House. In his remarks, he referred to Secretary of Agriculture Edward R. Madigan; Clayton Yeutter, chairman of the Republican National Committee and former Secretary of Agriculture; U.S. Trade Representative Carla A. Hills; Secretary of the Treasury Nicholas F. Brady; Secretary of Commerce Robert A. Mosbacher; Herb Plambeck and Ronald Hays, former president and current president of the National Association of Farm Broadcasters; President Saddam Hussein of Iraq; President Mikhail Gorbachev of the Soviet Union; Boris Yeltsin, President of the Russian Republic; Bill Mason, farm broadcaster at WGEL in Greenville, IL; President Carlos Salinas de Gortari of Mexico; Senator Robert Dole of Kansas; Michael LePorte, farm broadcaster at KRVN in Lexington, NE; and Michael J. Boskin, Chairman of the Council of Economic Advisers.