113. Memorandum From the Deputy Special Representative for Trade Negotiations (Wolff) to the Special Representative for Trade Negotiations (Strauss)1

SUBJECT

  • Government Reorganization and STR 2

Recent developments have prompted further thinking on government reorganization and the future role of STR. Specifically, (1) the Hungarians have made overtures to us on the possibility of a trade agreement, similar to the U.S.-Romanian agreement,3 with them; and (2) the U.S. is moving toward commodity agreements on sugar and cotton.

With respect to the first, we have directed the Hungarians towards the State Department (we could co-chair discussions) because STR does not have the personnel or a clear mandate to take the full lead in negotiating a U.S.-Hungarian agreement. On the second, as far as I can tell, the U.S. efforts are in something bordering on disarray. Both issues involve the sort of job that this Office does particularly well and for which we have wide support on the Hill and in the private sector (i.e., balancing in trade negotiations the international interest with the real problems of domestic industry and labor).

I feel that given the adequate staff we could effectively lead U.S. negotiating efforts on trade issues in accordance with the President’s expectations. Our leadership would bring a coherence and balance to U.S. policy which is sorely missing. Bureaucratics aside, I think careful consideration should be given to the possibility of consolidating within STR responsibility for all the various aspects of trade policy.

However, a greater STR role in these matters (and other areas of trade policy, which if logic were to dictate, should be consolidated in STR) would require expansion of the Office to the point where we would become something approaching a Department of Trade. This would rule out continuation of STR within the Executive Office of the President and so would have the costs of removing the STR further from a close advisory role to the President.

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I am not convinced that we are prepared yet to rationalize trade policy work within the Administration. I do think that the question merits serious review.

A final point—for purposes of our participation in the current effort to develop a reorganization plan for the Executive Office of the President,4 we should continue to support continuation of STR within the Executive Office of the President somewhat as it is now. Any broadening of STR’s role would have to be done in connection with a reorganization of the various Departments (State, Treasury, Commerce, etc.) and that issue has not yet begun to be addressed.

  1. Source: National Archives, RG 364, Special Trade Representative, 1977–1979, Box 45, Reorganization, 1977. No classification marking.
  2. Written in an unknown hand at the end of the subject line is, “The Post Strauss Era (for the future).”
  3. The U.S.-Romanian trade agreement, signed in April 1975, granted Romania most-favored-nation status. (26 UST 2305)
  4. A reference to P.L. 95–17, Reorganization Act, signed by Carter on April 6. See Public Papers: Carter, 1977, Book I, pp. 571–573.