| FCC Declares Cable Internet
Access an Interstate Information Service |
3/14. The Federal
Communications Commission (FCC) announced that it has
adopted both a Declaratory Ruling (DR) and Notice of Proposed
Rulemaking (NPRM) addressing the legal classification and the
appropriate regulatory framework for broadband access to the
Internet over cable system facilities.
The FCC stated in a release that "In a Declaratory Ruling
adopted today, the FCC concluded that cable modem service is
properly classified as an interstate information service and
is therefore subject to FCC jurisdiction. The FCC determined
that cable modem service is not a ``cable service´´ as
defined by the Communications Act. The FCC also said that
cable modem service does not contain a separate
``telecommunications service´´ offering and therefore is not
subject to common carrier regulation."
The FCC issued a short
release and separate statements of three of the FCC
Commissioners. However, it did not release either the DR or
the NPRM. The vote was three to one. Michael Copps
dissented. This is GN Docket No. 00-185.
The Communications Act of 1934, as amended over the years,
establishes separate regulatory frameworks for different
industries -- such as plain old fashioned telephone service,
cable television service offering one way programming,
broadcast television and radio, and information services. When
established, the various industries were distinct. Determining
which regulatory category applied was obvious. However, with
new technologies, and industry convergence, services are
offered that do not fit into the old regulatory categories.
How cable Internet access is classified for regulatory
purposes has consequences. For example, classification as a
telecommunications service could lead to the result that cable
operators must provide "open access" to their cable
facilities to competing ISPs. Similarly, classification as a
cable service could lead to regulation by a multitude of local
franchising authorities.
Various regulatory agencies and courts have reached different
conclusions regarding the regulatory status of Internet access
over cable. Various local cable franchising authorities have
asserted that it is a cable service. The U.S. Court of Appeals
(9thCir) ruled in AT&T
v. City of Portland that it is a telecommunications
service. (See, TLJ story, Ninth
Circuit Reverses District Court in AT&T v. Portland,
June 22, 2000.) In contrast, the U.S. Court of Appeals
(4thCir) ducked the issue in MediaOne
Group v. County of Henrico, 257 F. 3d 356 (2001). (See, TLJ
Daily E-Mail Alert No. 225, July 12, 2001.) Heretofore,
the FCC had also avoided taking a position.
Commission Michael Copps wrote a strenuous dissent.
He wrote that "A powerful case has been made that cable
modem services should also be subject to Title II".
FCC Chairman Michael Powell
wrote a separate
statement in support of the announced actions.
Commissioner Kathleen
Abernathy also wrote a separate
statement in support. |
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| FCC Announces NPRM |
3/14. The FCC also wrote in its March 14 release
that it has adopted a Notice of Proposed Rulemaking (NPRM)
that will examine "Certain issues in light of the FCC's
recent initiation of the Wireline Broadband NPRM,
including whether there are legal or policy reasons why it
should reach different conclusions with respect to wireline
broadband and cable modem service."
The NPRM will also examine "The scope of the FCC's
jurisdiction to regulate cable modem service, including
whether there are any constitutional limitations on the
exercise of that jurisdiction", "Whether, in light
of marketplace developments, it is necessary or appropriate at
this time to require multiple ISP access", and "The
role of state and local franchising authorities in regulating
cable modem service". |
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| Reaction to FCC
Announcements |
3/14. Many industry groups and regulated companies commented
on the Federal Communications Commission's (FCC) announcement
that it has adopted both a Declaratory Ruling (DR) that cable
Internet access is an information service, and that it has
adopted a Notice of Proposed Rulemaking (NPRM) addressing the
appropriate regulatory framework for broadband access to the
Internet over cable system facilities.
Robert Sachs, P/CEO of the National
Cable and Telecommunications Association (NCTA), which
will benefit from the deregulatory position adopted by the
FCC, praised the actions. He stated in a release
that "Today's FCC decision establishes a needed national
policy framework for cable high speed Internet services. The
classification of cable modem service as an 'information
service,' and not a telecommunications service, sends a strong
signal that cable Internet services will be able to continue
to develop in a business environment that favors competition
over regulation, and encourages new investment. The Commission
traditionally hasn't regulated information services. Given the
vigorous competition between cable modem, digital subscriber
line, and satellite delivered broadband Internet services, a
policy of regulatory restraint is particularly
appropriate."
Walter McCormick, P/CEO of the U.S.
Telecom Association, which represents the regional Bells,
stated that the phone companies would like the FCC to also
provide regulatory relief for them. He stated in a release
that "We are pleased that the Commission has recognized
that broadband investment can best be encouraged when its
rules are clear and its regulation minimal. Consumers,
however, will see little immediate benefit from today's
decision, as it does nothing to promote new competition to the
local cable monopolies that now dominate the market for high
speed Internet access. The important decisions are those that
remain, and the challenge for the Commission is to promote
intermodal competition by making sure that wireline
competitors do not remain handicapped by regulations that
disadvantage our offering of functionally equivalent advanced
services."
Similarly, Bob Blau, of BellSouth,
stated that it "is encouraged and certainly commends the
Commission's effort to re-think the type of regulatory
framework that should apply to cable modem and DSL services,
and more importantly whether these services need to be
regulated at all. They don't."
And likewise, Priscilla Ardoin, of SBC, said in a release
that "It makes sense that similar services are classified
and regulated in the same way. Whether it is DSL, cable modem,
satellite or wireless technology, the end product is the same
broadband Internet access service. By adopting rules that
apply equally to all broadband providers, the FCC has the
opportunity to create a unified, nation wide regulatory
framework for this country's broadband market." |
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| Bill Would Extend Normal
Trade Relations Status to Ukraine |
3/13. Rep. Bob
Schaffer (R-CO) and others introduced HR 3953, a bill to
authorize normal trade relations treatment to the products of
Ukraine. It was referred to the House Ways and Means
Committee. See also, Schaffer
release.
On January 2, the Office of the United
States Trade Representative (USTR) published a notice
in the Federal Register that it has determined to impose
prohibitive duties on certain imports from the Ukraine in
order "to obtain the elimination of the acts, policies,
and practices of the Government of Ukraine that result in the
inadequate protection of intellectual property rights".
This action was taken as a result of the Ukraine's failure
"to use existing law enforcement authority to stop the
ongoing unauthorized production of optical media products and
failure to enact an optical media licensing regime ..."
The 100% duties cover fuel oil, fertilizers, cooper, aluminum,
and other products. See, Federal Register, January 2, 2002,
Vol. 67, No. 1, at Pages 120 - 121. The duties took effect on
January 23, 2002. See also, USTR
release of January 23, 2002.
In February, the International
Intellectual Property Alliance (IIPA) asked the USTR to
keep Ukraine as a Special 301 "Priority Foreign
Country" until it passes and enforces an acceptable
optical media law. |
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| Treasury Secretary
Testifies Re IRS IT Funding |
3/14. Treasury Secretary Paul
O'Neill testified before the Senate
Appropriations Committee's Subcommittee on Treasury and
General Government regarding regarding the Fiscal Year 2003
budget for the Treasury
Department. See, O'Neill's prepared
testimony.
He testified, among other things, about the Department's
efforts to modernize its information technology, and to
provide online services, such as for filing of tax returns. He
stated that the IRS "continues to work towards the
Congressional goal of having 80% of all tax and information
returns filed electronically by 2007. As this method of tax
filing becomes more popular, the IRS has reduced processing
costs significantly per document, with less input errors and
reduced handling time and storage costs as well."
He asserted that the IRS "is committed to providing
excellent customer service and takes pride in the integrity of
their systems. As a result, they are continually making
improvements in operations efficiency and performance by
adopting best business practices and state of the art
technology."
He stated that the IRS "is replacing its antiquated
computer system with an information technology capacity that
is appropriate for the new century." He continued that
"The Department's FY 2003 budget provides $450 million
for the continuation of effort in re-engineering business
processes and developing new business systems to replace their
antiquated and obsolete system. This amount is $58 million
above the FY 2002 enacted level of $392 million, and $378
million above the FY 2001 enacted level of $72 million." |
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| House Commerce Committee
Leaders Write Sec. Evans Re ICANN |
3/13. Rep. Billy
Tauzin (R-LA), Rep.
John Dingell (D-MI), Rep.
Fred Upton (R-MI), Rep.
Ed Markey (D-MA), and Rep. John Shimkus
(R-IL) wrote a letter
to Secretary of Commerce Donald
Evans regarding the Internet
Corporation for Assigned Names and Numbers (ICANN).
They wrote: "According to the Memorandum
of Understanding between ICANN and the Department for
implementing a transition for ICANN's technical management of
Internet names and addresses, ICANN was to be founded upon the
principles of ``stability, competition, bottom-up
coordination, and representation.´´ Since its inception,
however, ICANN has increasingly departed from that limited
role. Its unchecked growth into general Internet policymaking
and regulation of commercial rights and interests is very
disturbing."
They also offered several recommendations. For example,
"The Department should ensure that ICANN's Board of
Directors is fully representative of all stakeholders,
including corporate stakeholders and members of the general
Internet community".
They also recommended that "ICANN should limit its
activities to its initial scope of jurisdiction, i.e.,
coordinating core Internet functions and the technical aspects
of naming and address allocation issues". They also
suggested that "There should be clear, written procedures
for approving new gTLDs, as well as any future technical
issues, including an impartial appeals process for those who
have process or substantive complaints."
Finally, the group stated that "we want to strongly
reiterate our support for continued Department of Commerce
control over the so-called ``A-root´´ server. We believe
that any assumption of control over that asset by any outside
entity would be contrary to the economic and national security
interests of the United States."
Reps. Tauzin and Dingell are the Chairman and ranking Democrat
of the House Commerce Committee. Reps. Upton and Markey are
the Chairman and ranking Democrat of the Telecom and Internet
Subcommittee. |
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| CIIP Holds Hearing on
OddzOn Products, Collaborative Research, and Patents |
3/14. The House
Judiciary Committee's Subcommittee on Courts, the
Internet, and Intellectual Property (CIIP) held a hearing
titled "Patent Law and Non-Profit Research
Collaboration."
Rep. Howard Coble
(R-NC), the Chairman of the Subcommittee, said in his opening
statement that "The Subcommittee has been approached
by the university community with serious concerns about an
issue arising from a recent case interpreting the Patent Act.
In the OddzOn Products case, the Court of Appeals for the
Federal Circuit held that certain confidential material
exchanged in the course of a research collaboration would
defeat the patents later developed."
The U.S. Court of Appeals (FedCir)
held in OddzOn
Products v. Just Toys, 122 F.3d 1396, 43 U.S.P.Q. 2d 1641
(Fed. Cir. 1997), that "subject matter derived from
another not only is itself unpatentable to the party who
derived it under § 102(f), but, when combined with other
prior art, may make a resulting obvious invention unpatentable
to that party under a combination of §§ 102(f) and
103."
35 U.S.C. § 103(c) provides that "Subject matter
developed by another person, which qualifies as prior art only
under one or more of subsections (e), (f) and (g) of section
102 of this title, shall not preclude patentability under this
section where the subject matter and the claimed invention
were, at the time the invention was made, owned by the same
person or subject to an obligation of assignment to the same
person." 35 U.S.C. § 102(f) provides that "A person
shall not be entitled to a patent unless ... (f) he did not
himself invent the subject matter sought to be patented".
Rep. Coble added that "I cannot emphasize enough the
benefit of university patents in an open society, since
patents result in the publication of scientific and technical
data for the world to study and build upon."
Rep. Howard Berman
(D-CA), the ranking Democrat on the Subcommittee, said in his opening
statement that "What makes this particularly
troubling is that this affects research universities and
non-profit institutions much more than it does private
companies. There are ways to maneuver around the threat of
103(c) -- by creating a joint venture, or by assigning
intellectual property rights to a single entity. However, many
state and federal government organizations cannot assign
rights to an outside partner due to their established laws and
practices. Public research institutions may not have the means
to circumvent the potential problems of 103(c)."
Kevin Rivette, a patent attorney, and author of Rembrandts
in the Attic: Unlocking the Hidden Value of Patents, said
in his prepared
testimony that "I believe that legislation that
furthers this special Non-profit research collaboration with
private industry is in the best interest of our country
..."
Similarly, Carl Gulbrandsen, who testified on behalf of a
University of Wisconsin patent management group, said in his prepared
testimony that the Congress should pass legislation to
reverse the Oddzon case, and promote university collaboration.
In contrast, Charlie Van Horn, who testified on behalf of the American Intellectual Property
Law Association, said in his prepared
testimony that "special care needs to be taken with
respect to any efforts to amend 35 U.S.C. § 103(c) to ensure
that it would not complicate the operation or implementation
of this section and/or create traps for unwary
collaborators."
Similarly, Jon
Grossman, an attorney with the law firm of Dickstein Shapiro, said in his
prepared
testimony that the Oddzon case does not threaten
universities, and that "broadening the scope or meaning
of Section 103(c) may cause unintended problems that
negatively impact the U.S. Patent & Trademark Office
(“PTO”), complicate patent practice, and harm
competition." |
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| Senate Committee Holds
Hearing on Copy Protection |
3/14. The Senate
Judiciary Committee held a hearing titled
"Competition, Innovation, and Public Policy in the
Digital Age: Is the Marketplace Working to Protect Digital
Creative Works?"
Sen. Patrick Leahy
(D-VT), Chairman of the Committee, said in his opening
statement that "Senator Hatch and I would ask the
senior executives at media, information technology, and
consumer electronics companies to get more involved in the
discussions underway about digital rights management systems,
and make sure that the people participating in those talks
meet on a regular and frequent basis. ... We know that
legislation may be necessary to implement some of the intra-
industry agreements that are reached and we want to be in a
position to move promptly and thoughtfully when the time is
ripe."
Sen. Orrin Hatch
(R-UT), the ranking Republican on the Committee, stated in his
opening
statement that "I want to encourage the parties --
the content community and the information technology community
-- to continue and redouble your efforts to find common
ground. These are complex issues and with the right resources,
I am confident you can resolve these problems." Unlike, Sen. Ernest Hollings
(D-SC), the Chairman of the Senate Commerce
Committee, neither suggested that the Congress should step
in and pass legislation.
Craig Barrett, the CEO of Intel,
said that the Congress should not impose regulatory solutions.
See, prepared
testimony. In contrast, Hillary Rosen, P/CEO of the Recording Industry Association of
America (RIAA) submitted a statement
[PDF] in which she said that "additional help may be
needed, whether in the form of enhanced legal remedies, more
active enforcement of the law, or legislation requiring
implementation of technical standards to ensure that all
technology companies provide the same level of needed
protection." However, she was not a witness at the
hearing.
See also, prepared testimony of the other hearing witnesses: Richard
Parsons (AOL Time Warner), Jonathan
Taplin (Intertainer), Joe
Kraus, and Justin
Hughes (UCLA Law School). |
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| House Subcommittee Holds
Hearing on Technology Administration Budget |
3/14. The House
Science Committee's Subcommittee on Environment,
Technology, and Standards held a hearing titled
"Technology Administration: Review and
Reauthorization". The hearing examined the proposed
budget for Fiscal Year 2003 for the Technology
Administration (TA).
The TA, which is a part of the Commerce
Department, consists of the National
Institute of Standards and Technology (NIST), the National Technical Information
Service (NTIS), and the Office of
Technology Policy (OTP). The NIST budget constitutes more
than 98% of the TA's budget.
See, opening
statement of Rep.
Vernon Ehlers (R-MI), Chairman of the Subcommittee. See
also, prepared testimony of Phillip
Bond (Under Secretary of Commerce for Technology, and
Chief of Staff to the Secretary of Commerce), Arden
Bement (Director of the NIST), Christopher
Hill (George Mason University), Birgit
Klohs (The Right Place Program), and Michael
Wojcicki (The Modernization Forum). |
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| Friday, March 15 |
The House will not be in session.
9:00 AM. The AFL-CIO's
Department for Professional Employees will host a panel of
speakers who will advocate retention of the FCC's newspaper
and broadcast cross ownership rules. FCC Commission Michael
Copps will speak. See, AFL-CIO
notice. For more information, contact Leandra Kennedy at lkennedy @aflcio.org or
202 638-0320. Location: National
Press Club, Holeman Lounge, 529 14th St. NW, 13th Floor.
9:30 - 11:00 AM. The Progressive
Policy Institute (PPI) will host a panel discussion on the
impact of new homeland security efforts on privacy issues. The
panelists will be Robert Atkinson (PPI), Shane Ham (PPI), and
Jim Dempsey (Center for Democracy and Technology). Location:
PPI, 600 Pennsylvania Ave., SE, Suite 400.
10:00 AM. - 12:00 NOON. The Center
for Strategic and International Studies (CSIS) will host a
panel discussion titled "Retooling the WTO: The Doha
Round and Beyond". The participants will be Dorothy
Dwoskin (Assistant USTR for WTO and Multilateral Affairs),
Eduardo Perez Motta (Ambassador to the WTO, Mexico Chairman,
WTO Council on Intellectual Property), Rufus Yerxa (former
Deputy USTR), and John Weekes (former Canadian Ambassador to
the WTO). See, CSIS notice.
Location: CSIS, 1800 K Street, N.W., B-1 conference level.
11:00 AM. FTC Chairman Timothy
Muris will give the keynote address at the Consumer Federation of
America's Assembly. Location: Washington Plaza Hotel, 10
Thomas Circle, NW.
Deadline to submit comments to the FCC on the World
Radiocommunication Conference Advisory Committee's (WRC-03
Advisory Committee) recommendations of February 6, 2002,
regarding the 2003 World Radiocommunication Conference
(WRC-03). See, notice
[16 pages in PDF] requesting public comments, and attached
recommendations. |
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| Monday, March 18 |
9:30 AM. The U.S. Court of Appeals (DCCir)
will hear oral argument in Costa de Oro TV v. FCC, No.
01-1153. Judges Ginsburg, Henderson and Tatel will preside.
Location: 333 Constitution Ave. NW.
12:00 NOON. Deadline to submit requests to USTR to
testify orally at its April 1 hearing negotiation of a U.S.
Singapore Free Trade Agreement. See, notice
in the Federal Register, Vol. 67, No. 40, at pages 9349 -
9351.
Deadline to submit comments to the FCC in response
to its notice of proposed rulemaking (NPRM) regarding its
unbundling analysis under § 251
of the Communications Act and the identification of specific
unbundling requirements for incumbent local exchange carriers
(ILECs). The FCC adopted this NPRM at its December 12 meeting.
This is CC Docket No. 01-338. See, notice
in the Federal Register, January 15, 2002, Vol. 67, No. 10, at
Page 1947 - 1953. Note: SBC submitted a request
for extension of deadline [PDF] on March 11. |
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| Tuesday, March 19 |
9:30 AM - 4:30 PM. The FTC and the Department
of Justice (DOJ) Antitrust
Division will continue their joint hearings titled
"Competition and Intellectual Property Law and Policy in
the Knowledge Based Economy." From 9:30 AM until 12:00
NOON, there will be presentations on "Business
Perspectives on Patents". From 1:30 until 4:30 PM, there
will be presentations on "Business Perspectives on
Patents: Biotech and Pharmaceuticals. See, agenda.
Location: Room 432, FTC, 600 Pennsylvania Ave., NW.
10:00 AM. The Senate
Appropriations Committee's Subcommittee on Commerce,
Justice, State, and the Judiciary will hold a hearing on the
proposed budget estimates for Fiscal Year 2003 for the Federal Trade Commission, and
other agencies. Location: Room 138, Dirksen Building. |
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| Wednesday, March 20 |
9:30 AM. The Senate
Commerce Committee will hold a hearing on
"competition in the local telecommunications
marketplace". Sen.
Ernest Hollings (D-SC) will preside. Location: Room 253,
Russell Building.
9:30 AM - 4:30 PM. The FTC and the Department
of Justice (DOJ) Antitrust
Division will continue their joint hearings titled
"Competition and Intellectual Property Law and Policy in
the Knowledge Based Economy." From 9:30 AM until 12:00
NOON, there will be presentations on "Business
Perspectives on Patents: Hardware and Semiconductors".
From 1:30 until 4:30 PM there will be presentations on
"Business Perspectives on Patents: Software and the
Internet". See, agenda.
Location: Room 432, FTC, 600 Pennsylvania Ave., NW.
10:00 AM. The Senate
Judiciary Committee's Subcommittee on Technology,
Terrorism, and Government Information Subcommittee will hold
hearings to examine identity theft and information protection.
Sen. Dianne Feinstein
(D-CA) will preside. Location: Room 226, Dirksen Senate Office
Building.
CANCELLED. 10:00
AM. The FCC's
Technological Advisory Council will hold a meeting. See, notice
in Federal Register, February 26, 2002, Vol. 67, No. 38, at
Page 8801. Location: FCC, 445 12th St., SW., Room TW-C305,
Washington DC. See, cancellation
notice in Federal Register, March 11, 2002, Vol. 67, No.
47, at Page 10920. The next meeting is April 26; see, FCC
notice of March 12.
12:15 PM. The FCBA's
Cable Committee will host a luncheon. The speaker will be
Catherine Bohigian, Legal Advisor to FCC Commissioner Kevin
Martin. The price to attend is $15. RSVP to Wendy Parish at wendy@fcba.org by 5:00 PM on
March 18.
2:00 PM. The House
Appropriations Committee's Subcommittee on Commerce,
Justice, State, and the Judiciary will hold a hearing on the
proposed budget for FY 2003 for the Office of the U.S. Trade Representative (USTR).
6:00 - 8:00 PM. The FCBA will
host a Continuing Legal Education (CLE) seminar titled
"Telecommunications 201". Location: Capital Hilton
Hotel, 16th and K Streets, NW. |
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| Thursday, March 21 |
8:30 AM - 12:00 NOON. The law firm of Steptoe & Johnson and
The Open Group will host a workshop titled "Liability and
Information Assurance: The Role of Law, Regulation, and Self
Regulation". The workshop will focus on allocating
liability for breaches of information security, and the
various roles that law, regulation, and private contractual
agreements can or should play in the allocation of
responsibility for information security failures. RSVP to salbertaz @steptoe.com.
For more information, contact mschneck @steptoe.com.
Location: 1330 Connecticut Avenue, NW.
10:00 AM. The Senate
Appropriations Subcommittee's Subcommittee on Commerce,
Justice, State, and the Judiciary will hold a hearing on the
administration's proposed budget estimates for FY 2003 for the
Federal Bureau of Investigation, Immigration and
Naturalization Service, and the Drug Enforcement
Administration. Location: Room 116, Dirksen Building.
12:15 PM. The FCBA's
Transactional Practice Committee will host a brown bag lunch
on satellite and other international telecommunications
transactions. RSVP to Brian Madden at 202 416-6770. Location: Leventhal Senter & Lerman,
2000 K Street, NW.
2:30 PM. The Senate
Commerce Committee's Subcommittee on Science, Technology,
and Space will hold hearing to examine federal research and
development issues. Location: Room 253, Russell Building.
3:30 PM. Margaret
Radin (Stanford University Law School) will give a lecture
titled "Contract Today and Tomorrow: Binding Commitment
in the Networked World". Location: Georgetown University
Law Center, Faculty Lounge, 5th Floor, McDonough Hall, 600 New
Jersey Ave., NW.
8:00 PM. Deadline to submit applications to the NTIA
for Technology
Opportunity Program (TOP) grants for FY 2002. See, notice
in Federal Register. |
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| More News |
3/13. Rep. Lindsey
Graham (R-SC) and others introduced HR 3957, the Canceling
Loans to Allow School Systems to Attract Classroom Teachers
Act (CLASS ACT), a bill to increase to $17,500 the amount of
student loans that may be forgiven for teachers in
mathematics, science, and special education. It was referred
to the House Committee
on Education and the Workforce. See also, Graham
release.
3/13. Rep. Ron Paul
(R-TX) stated in the House that "the administration's
recent decision to impose a 30 percent tariff on steel
imports" is "a step backward toward the
protectionist thinking that dominated Washington in decades
past." He asked rhetorically: "What happened to the
wonderful harmony that the WTO was supposed to bring to the
global market? The administration has been roundly criticized
since the steel decision was announced last week, especially
by our WTO ``partners.´´ The European Union is preparing to
impose retaliatory sanctions to protect its own steel
industry. EU Trade Commissioner Pascal Lamy has accused the
U.S. of setting the stage for a global trade war". See,
Cong. Rec., March 13, 2002, at pages H887-8. |
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