Do our negotiators have any questions of our panelists?

Dr. Murphy.

ASSISTANT U.S. TRADE REPRESENTATIVE MURPHY: A question for Professor Sumner, who had some provocative thoughts, particularly the notion that we should ignore internal supports. And I hear what you're saying. I guess the thinking is that if you -- obviously, if you have internal supports to produce surpluses, then you have need for export subsidies.

And yes, we are clearly focused on export subsidies, but can you really afford to ignore those internal supports, since our hope of getting the export subsidies, I think, is directly related to those internal domestic supports. But I would be interested in that, if you could elaborate on that a bit.

DR. SUMNER: Yeah, I can. And I should say I was heavily involved in the Uruguay Round, where we spent a lot of time on internal supports and I was influenced a lot by that. There are about four or five reasons.

The first is, as you know, the internal support agreement that we have is weak and loose and complicated and complex. As I often tell my students, the more pages it takes, the less effective it will be. And the internal support agreement is stacks and stacks of pages, most of which are loopholes.

And I don't honestly see any way around that, that being the case. I don't think it was the failure of negotiators. I think the negotiators that we had did a good job. It's just that there are so many varieties of internal support somebody can come up with, that we can write a bunch of rules for the ones that people have told us about now and they'll come up with a bunch more. They won't be effective.

Secondly, internal support agreements, the ones we have, weaken the nullification and impairment parts. If we didn't have an internal support section, we could apply nullification and impairment. As you know, that's what got us additional access on oil seeds into the European Union. It wasn't an internal support sanction. It was nullification and impairment.

It's also the case that it's on -- both on the import and the export side does border measures. If you get the border measures down, it's very expensive. It's very difficult to think of a scheme to have high supports internally if you can't protect your borders. And we know that in U.S. policies as well.

One of the issues that concerns me is, we divert the attention away from border measures, the negotiator time. You folks only have so much time and energy and effort. And the more you bash the Europeans and others over one issue or another, the more you're willing to say, ahh, we'll let this other one slide. So if you spend your time on internal supports, you won't get as much.

I also think there's a very strong argument that countries, our country included, can quite legitimately claim if we want to support agriculture, we ought to be able to in one form or another. If those are folks we like, we support them. Once you acknowledge that, then you're going to allow some kind of internal supports. And frankly, being able to tell the difference between, as you notice with this panel, being able to tell the difference between red, green and amber is pretty hard.

(Laughter.)

DR. SUMNER: So I just -- I think it's -- one, it's not feasible, even if we wanted to do it. And two, I think it's counterproductive in a lot of ways. And I've written on this question a few times for academic audiences. And I can provide -- there's some, a little, a paragraph of two, in this statement, and I can provide more to your staff and Secretary Rominger's staff and others.

ASSISTANT U.S. TRADE REPRESENTATIVE MURPHY: That would be great.

DR. SUMNER: If somebody can contact me, I'll give you more background.

CO-MODERATOR JONES: Mr. Rominger.

USDA DEPUTY SECRETARY ROMINGER: Yeah. I'd like to follow up with you, Dr. Sumner, on I think you made a comment about special and differential treatment. I'm wondering what you think the role of the multilateral institutions are, the World Bank, the IMF in providing development assistance. I don't think we can undue it all ourselves.

DR. SUMNER: No. I think that's a very good point. I'm chairman of something called the International Agricultural Trade Research Consortium, which is a group of academics and government people, foreign ag service, and ERS participate quite heavily, as well as the Canadians, the Europeans and others. That's a non-governmental group with a lot of government participation that tries to provide economic background to our counterparts all over the world.

We're participating with a major ongoing project with the World Bank to provide technical assistance and help the LDCs to help them understand how to better negotiate in the round what various trade agreements mean to them. So I don't think it has to be on a bilateral basis that we provide assistance.

And, frankly, I think if this is what you're getting at, I think most countries might naturally be suspicious of us providing them. It's like you and I will have a legal dispute and I say, "Well, that's okay. You can use my lawyer. I'll give you my time for free." Well, you can be a little suspicious about that. So I do think you're right, international organizations.

The major point I want to make here though is that opening markets is good for importers as well as exporters. And it doesn't give less developed countries anything that helps their economy grow, by saying we'll allow them to continue to be protectionists. That's not doing them a favor and it's a fiction. And I think it's been a destructive fiction that the WTO has had in place for many, many years and it's now time to just drop that fiction. I think it's in their interest to play by the rules.

USDA DEPUTY SECRETARY ROMINGER: I had a question for the Date industry here as well. I wondered, focussing on the EU and the problems there, that given the fact that the Middle East and India consume a lot of Dates, have you taken a look at that market and the possibilities of broadening your exports?

MR. VANDERVOORT: Well, we certainly end up throwing a few here and there. We just tend to be -- with our group, it has to deal with the price and the quality issue as to why it goes into Europe.

MR. TAFT: Well, as I briefly mentioned in my presentation, we produce 15 percent of the world production, but of what is actually harvested and packed, if you include, you know, the way it grows in those countries that you mentioned, we are probably less than five percent of the world production.

And they certainly can produce it in their own backyard much cheaper than we can here and then ship it to them. Although, there is always a market for quality and we have had some instances where we do ship into the countries that you mentioned, because there's always somebody who wants to pay a little bit more for something that is better appealing to the eye and has a better taste.

USDA DEPUTY SECRETARY ROMINGER: Thank you.

CO-MODERATOR JONES: Anymore questions from our negotiators?

Seeing none, thank you, panel, for your time.

USDA DEPUTY SECRETARY ROMINGER: Thanks, Roger, for all your support.