U.S. Trade Representative William E. Brock yesterday signaled a new, tough tone on trade by the Reagan administration, which goes into its second term facing massive imports of manufactured goods from all over the world and a continuation of record trade deficits.
The United States "will be a good deal less patient" and "a good deal more aggressive" in dealing with unfair trading practices such as government subsidies, nontariff barriers, bars to U.S. investment, and pirating and counterfeiting, Brock told a Washington International Trade Association luncheon.
He said that this new American attitude will include demands for changes in the 91-nation General Agreement on Tariffs and Trade (GATT) to speed up its process of settling disputes, set rules for trade in agriculture and expand its authority to cover services, in which the United States is the world leader.
"We are not satisfied with the GATT and international mechanisms in place today. . . . They have got to do more and better in the future," Brock said.
Brock's tough comments, in one of the first speeches he has given since Reagan won reelection three weeks ago, came as the United States took a harder line at GATT's annual conference in Geneva.
Deputy U.S. Trade Representative Michael B. Smith told reporters there Monday that the United States is blocking consideration of the GATT budget to see if its work program for next year includes trade in services such as banking, insurance, engineering and accounting. He denied, however, that he had said the United States would withhold its contribution to GATT, amounting to 14.2 percent of the organization's budget, if it refuses to tackle the issue of services.
"It's hardball time, neighbor," Brock remarked yesterday when he saw reports of Smith's press conference.
The U.S. push over the past two years to expand GATT to include trade in services has drawn stiff opposition from Third World nations, many of which restrict outside countries from participating in such service industries as banking and insurance.
Brazilian Ambassador Paulo Nogueira Battista, speaking outside the GATT meeting yesterday, accused the United States of lacking "rationality" by trying to ease restriction on trade in services, an issue that "a great majority of delegations are not prepared to undertake now," the Associated Press reported.
Brazil, which is trying to develop its own service industry, is leading opposition to U.S. attempts to ease restrictions on trade in services.
With service industries making up two-thirds of the United States' gross national product, however, Brock said it is "insane" to build a global trading system only on tangible goods and leave the exchange of services outside.
He promised that the Reagan administration is going "to get increasingly aggressive" in fighting thefts of intellectual property such as patented products and goods covered by trademarks. He said the trade bill, passed in the end of the last congressional session, gives the government added weapons to use against countries that fail to stop piracy and counterfeiting of American goods by their citizens.
"We are going to have to impose a little bit of pain on those who constantly abuse our intellectual property rights," Brock said.
He also told the meeting that the Reagan administration has not seriously considered imposing a surcharge on imports to fight the trade and budget deficits. He characterized it as providing "short-term relief and long-term heartburn."
Brock indicated that the White House has not decided whether to support a trade reorganization measure again next year that failed to win congressional support this year. The measure, favored by Commerce Secretary Malcolm Baldrige, would pull Brock's office into the Commerce Department, which would be renamed the Department of International Trade and Industry.