Memorandum From the President on Import Relief for the Domestic Mushroom Industry

Memorandum for the United States Trade Representative

Pursuant to Section 202(b) (1) of the Trade Act of 1974 (19 U.S.C. 2252), I have determined to provide import relief for the domestic mushroom industry in the form of increased duties. This action is in response to the affirmative finding of the U.S. International Trade Commission (USITC) on Investigation Number 201TA-43. The investigation was initiated as a result of a petition by the American Mushroom Institute. The USITC's report was received on August 18, 1980. The USITC found that increased imports had been a substantial cause of serious injury, or threat thereof, to the domestic industry. It recommended the imposition of import quotas over the next three years as an appropriate remedy.

After considering all relevant aspects of the case, including those considerations set forth in section 202(c) of the Trade Act, I have determined to provide three years of import relief for the domestic industry in the form of increased duties. I will issue a Presidential Proclamation, to be effective within fifteen days, increasing the current duty of 3.2 cents per pound plus 10 percent ad valorem on imported mushrooms, otherwise prepared or preserved, provided for in item number 144.20 of the Tariff Schedules of the United States, to:
3.2 cents per pound plus 30 percent ad valorem for the first year of relief;
3.2 cents per pound plus 25 percent ad valorem for the second year of relief; and
3.2 cents per pound plus 20 percent ad valorem for the third year of relief.

In addition to this import relief, I am creating a White House Task Force under the direction of Stuart Eizenstat, Assistant to the President for Domestic Affairs and Policy, that will coordinate the Administration's efforts to assist the mushroom industry in adjusting to import competition. This Task Force will include representatives from the Office of the United States Trade Representative, the Council of Economic Advisers, the Small Business Administration, the Economic Development Administration, the Farm Home Administration, and the Agricultural Marketing Service. The Task Force will provide appropriate technical and financial assistance to facilitate the industry's adjustment to increased imports.

I am taking these actions to mitigate the human and social problems associated with economic adjustment. Since these actions are temporary, it is vitally important that firms within the industry take the necessary management decisions within the relief period to become more competitive or to diversify. To monitor the industry's progress, I am directing you as the United States Trade Representative to request under Section 203(i)(1) of the Trade Act of 1974 that the USITC report, within eighteen months of this decision, on the industry's efforts to adjust.

I have chosen to provide tariff relief rather than the quota relief recommended by the USITC because I believe it is the most appropriate form of relief in this case. Increased tariffs will enable the canning industry to become more profitable. This improvement in their financial position, which is not expected to have a significant inflationary impact, will enable the industry to implement adjustment programs which they have pledged to undertake. Tariffs are also preferable in this case because, unlike quotas, they allow the natural market forces to continue to work, thus providing relatively more incentive to the industry to adjust to foreign competition. Finally tariffs are preferred because of the difficulty of equitably allocating quotas among countries when there are highly competitive new suppliers entering a market dominated by traditional suppliers.

JIMMY CARTER