ity of the industry, the number of interested parties, both governmental and nongovernmental, and the need to develop sound data as a basis for research and planning, it would appear that the Federal Government has a legitimate role to play in facilitating the development of tourism data based upon standardized definitions and collection methodologies. The NTPS also notes that there are a large number of Federal programs whose activities and policies have an impact on tourism. This condition is not unique to tourism but the fact that it exists indicates that the Federal Government has a role in insuring a reasonable degree of coordination among tourism-related programs. This coordination role involves at least two elements. The first is the coordination of operational activities related to tourism. These include tourism development, economic development, overseas promotion, customs and immigration operations, and so forth. The second is our responsibility for assessing the impact that Federal policies have on tourism and the tourism industry. Here I refer to policies concerning taxation, energy, transportation, the environment, and so forth. The third general direction which is discussed in the NTPS relates to the Federal role in research. Research is clearly needed to support the policy role which I have just described. We also believe that the Federal Government could stimulate, support, and coordinate Federal as well as private sector and local government research on important issues such as seasonality, energy conservation, increased travel to depressed areas, and expanded employment opportunities. As I have suggested, we need to reassess our tourism responsibilities to concentrate more on coordination, policy assessment, data, and research. The next question, therefore, is what kind of program is needed to meet these responsibilities. The NTPS recommends the establishment of a new, independent U.S. Travel and Recreation Agency. Our initial judgment is that this recommendation is not one that we can support. For two reasons. First, it runs counter to the President's policy of curbing the growth in the number of independent Federal agencies. Second, we are not convinced that tourism programs and recreation programs are as closely related as the study suggests. We are sympathetic to the notion that it is difficult to determine when a person is involved in recreation or in tourism. Nonetheless, our view is that the principal aim of a tourism program differs markedly from the principal aim of recreation programs. Tourism focuses on visitor expenditures as a source of economic development. Recreation programs are principally designed to provide increased recreational and cultural opportunities for the Nation's population. These two activities are obviously interrelated. The important point, however, is that they are based on fundamentally different missions and, therefore, require fundamentally different kinds of policy directions and management. Because of these differences we fear that the economic development focus of the tourism program would be lost if combined with recreation. We do not believe that these two programs should be merged. While we cannot support the study's recommendation to establish an independent travel and recreation agency, we believe that the Department of Commerce can serve as an effective organizational base to accommodate new Federal directions in tourism. One factor, certainly, is Secretary Kreps' effort to focus all of the Department's resources on some of our critical economic development problems. As you know, Mr. Chairman, the Secretary views tourism as an important tool in this effort. Moreover, Commerce already has expertise that will be important if new directions in tourism are to be effectively implemented. For example, the Bureau of the Census is already an important resource in developing improved tourism data. In addition, a Commercebased program can take advantage of its access to the Economic Development Administration and the title V regional commissions also in Commerce. We think that an effective tourism program must work with these two agencies, and through them with State and local government officials, to integrate tourism into economic development and planning. Indeed, sir, the U.S. Travel Service (USTS) has been very effective during the last few months in doing so. Recently the Department has taken a number of steps to improve its industrial policy and analysis capabilities. The thrust here is to understand business and economic conditions in specific industrial sectors so that we can determine the impact that new developments, including governmental policies, have on these sectors. We think that this is an important part of any Federal role in tourism, and believe that it can be performed well as part of Commerce's overall industrial analysis effort. Finally, few issues are more difficult to deal with in Government than coordination among programs in different agencies. The NTPS has tried to deal with this problem by recommending the establishment of three committees, one to coordinate Federal programs, another for coordinating Federal with State and local government activities, and a third for coordinating Federal activities with the private sector. I agree that coordination among these parties is necessary, but the proposed committees are not the answer. The committee structures, in my view, are too complex and cumbersome and would collapse of their own weight. I believe coordination is an intrinsic part of the management function for any program and can be better accomplished that way. In summary, Mr. Chairman, the administration certainly agrees that the Federal role in tourism must be reassessed. The Department of Commerce now has underway an effort to develop the specifics of an appropriate Federal role in tourism. We intend that this effort will involve discussions with many of the people participating in these hearings as well as with members of this committee and its staff. We hope that our work together will provide a sound and effective Federal tourism program which will reflect legitimate Federal interests while addressing the needs of State and local governments, the tourism industry, and the American public. Mr. Chairman, that concludes by testimony. I will be happy to answer any questions. Senator INOUYE. Thank you very much, Madam Secretary. Are you seriously convinced that tourism enjoys a position of high importance and significance in this administration? Mrs. PORTER. I am absolutely convinced, Mr. Chairman, that this administration recognizes the importance of the tourism industry to the overall economic welfare of this country. We and the Office of Management and Budget (OMB) and the White House recognize how important tourism is to our economic well-being. Senator INOUYE. I ask this question because as one American citizen I cannot quite agree with that conclusion after studying some of the activities and nonactivities. It is not just this administration, but I must say that ever since I have been in Washington, tourism has been, at best, a nuisance in some administrations and in others it was, at best, reluctantly agreed upon. This was in prior administrations, but I recall those days not too long ago when-and by "we" I mean Congress-had to force on that administration an assistant secretary in charge of tourism. Its reason for opposing an upgrade for that position was that it would require an additional car with a driver. We didn't want to add that cost to this Government of ours. I notice that this administration has made a big issue out of the deduction of certain luncheon costs as part of business expenses. Some of us maintain that this is a legitimate cost of running business, and has much to do with hotel and restaurant industries. So I welcome your concern and your interest, but I think, once again, we'll have to pull some teeth here. And we have found in the past that it's not easy to pull teeth, whether it's a Democratic or Republican administration. In communicating with the White House tourism representative, I believe the committee staff emphasized that these 3 days of hearings would be concerned solely with the national tourism policy and on a Federal coordinating mechanism, and that in subsequent hearings we would be concerned with implementing mechanisms as the U.S. Travel and Recreation Agency to which you address your testimony. The press release of the committee announcing these hearings and the fact sheet went into great detail on this point. The Federal coordinating mechanism which the A. D. Little report recommended was a Cabinet level interagency coordinating council. Is there any reason why your testimony did not address itself to the National Travel and Recreation Policy Council, especially since this issue was a concern of the committee today? Mrs. PORTER. Our position is that a national policy coordinating council would not be a useful coordinating mechanism, sir. It is our view that the coordinating mechanisms that are proposed by the study are not the answer to the problem of coordination. Senator INOUYE. I believe your testimony says it's too complex. Mrs. PORTER. That's correct, sir. Senator INOUYE. Now what would you suggest, besides business as usual? Mrs. PORTER. Well, sir, it is not business as usual at the Commerce Department. We are constructing an also complex but we think more workable process of coordination, particularly on the various industrial sectors of the society. It's our view that the answer to coordination is not necessarily structural. It can be and perhaps might be more successful if it is process. I mentioned in my testimony that the Department of Commerce is developing a process of industrial policy analysis. We have undertaken steps now to significantly strengthen the microeconomic analysis that was supposed to have been done and we felt had not been effectively done in our Industry and Trade Aministration. We are building an internal policy analysis and review process which would provide the policymakers in the Federal Governmentthe Council of Economic Advisers, the Council on Wage and Price Stability, the Treasury Department, and others—with information on the effects of government regulation, government actions, foreign markets, and economic conditions on various sectors of the society. We think that by analyzing information about the impact of various actions on the various elements of the tourism industry or other industries, we have a mechanism, a process, of bringing this information to the decisionmakers so that intelligent policies are effected. Senator INOUYE. Is this coordinating agency in operation now? Mrs. PORTER. This is not a coordinating agency, sir. This is a coordinating mechanism within the Department of Commerce. It would be a very small organizational structure. We have it in its final design stages now. It would be two committees under the overall supervision of the Under Secretary, bringing together the development of policy from the Office of the Assistant Secretary for Policy with the analysis of information about the health of these various industries from the Industry Trade Administration. Obviously, tourism would be a high priority industry to keep our finger on. It is in the process of being developed now and we have just received approval from the Office of Management and Budget for establishing it. We are about to begin. We require some reprograming. We need to get the approval of our appropriations committee for that. Senator INOUYE. Madam Secretary, if you had gone through the files of this committee and the record of our concern, I'm certain you would have noted that we have been suggesting, recommending, and cajoling over many years that something be done to coordinate all of these activities, and to have a general policy. Four years ago the administration witnesses said, "We are going to do that," and that was the Alpha and Omega. We never heard anything after that. We have been told time and again that this is of prime importance, but yet the Arthur D. Little study indicates from their interviews with high-level, mid-level, and low-level staff personnel, that with all the other agencies-name them-tourism and tourism-related activities are considered the lowest priority. Some agencies have never heard of USTS and now you're suggesting that they play a hand in running the show here. What I'm afraid of is that if we went along with your suggestions, we'll be back again 2 years from now doing the same thing. Mrs. PORTER. Mr. Chairman, I Senator INOUYE. I don't doubt your sincerity at all, but I know that's what we'll be doing. Mrs. PORTER. Well, sir, I share your frustration. I think that the difficulty that this committee and the country has experienced has been the fact that to really change anything in government requires persistence and requires leadership that stays. You have not had Secretaries of the Commerce Department who stayed year after year after year until the job was done. This Secretary is committed to stay and she's also committed to seeing that tourism is recognized as the important industry that it is. The interviews that are reflected in the study were made at the beginning of this administration, sir, and I think do not reflect the importance that all of the agencies in Commerce now attach to tourism. Senator INOUYE. Just recently the Heritage Conservation and Recreation Service in the Interior Department conducted a nationwide study and survey on the national priority issues to be addressed in the 1978 nationwide outdoor recreation plan which must be submitted to Congress. It was almost like afterthought that they called upon the USTS to comment after the issue reports were prepared. Do you consider that giving USTS high priority or where was the Commerce Department? For that matter, where was the USTS when this study was going on? Mrs. PORTER. I beg your pardon? Which study are you referring to? Senator INOUYE. The 10 national priority issue reports being developed as part of the 1978 nationwide outdoor recreation plan. Mrs. PORTER. It is my understanding that representatives from the USTS were involved and have consulted with the Interior Department in the development of the recreation plan. Senator INOUYE. I would suggest you ask the USTS representative because that representative will tell you that the role the agency played was a very small one and indeed a good deal of that role was after it was all over. Then there are other matters of coordination that possibly in our naivete we can't understand. There's an agency that plays a major role in determining the future of tourism in the United States, and that's the CAB. I would think that the administration would almost insist that there be some sort of working relationship between USTS and CAB. I don't think they even send reports to each other.1 Mrs. PORTER. Again, sir, it is my understanding that we communicate very frequently and regularly with the Civil Aeronautics Board and the Interior Department. I believe, sir, that in the last few months our communications with other agencies in the Government have been significantly improved. I do agree with you that 111⁄2 years ago and even 1 year ago communication was nonexistent, but we have been working very, very hard to establish linkages with those agencies that impact upon tourism. We're not perfect but we are getting better at it every day. Senator INOUYE. I'm certain you will agree that if it were not for the action taken by the Congress and the action taken by the industry, 1 The following letter appears at pp. 14-15, of the hearing on the nomination of Creighton D. Holden, before the Committee on Commerce, 94th Cong., 1st sess. (serial No. 9439): GENERAL COUNSEL OF THE DEPARTMENT OF COMMERCE, Hon. DANIEL K. INOUYE, DEAR MR. CHAIRMAN: In a recent telephone conversation between Mr. Hardy of the Subcommittee staff and Mrs. Breed of my office, Mr. Hardy requested additional comments on some points I discussed in my letter to you of October 3, 1975. The letter responded to two questions you raised during the September 29th hearings on the confirmation of Mr. Creighton Holden as Assistant Secretary of Commerce for Tourism. Second, Mr. Hardy requested my further opinion as to what action would be necessary in order to permit USTS to make its independent views known to the Civil Aeronautics Board on matters affecting tourism, or to participate formally and independently in proceedings where tourism matters are involved before the CAB or other government agencies. As I explained in my October 3rd letter, USTS is a primary operating unit of the Department of Commerce, and not an independent agency. Thus, as a matter of policy, any position developed by USTS in response to a matter pending before another government agency must take into account the views of other interested units of this Department. The position which is ultimately taken must be a Department of Commerce position, and is presented as such. Accordingly, I am of the opinion that legislation removing USTS from the Department and establishing it as an independent agency would be necessary before USTS could speak independently of this Department on tourism matters. If Congress should propose such legislation, we would have to examine the implications closely at that time. I trust that you will find this responsive to Mr. Hardy's questions. Sincerely, KARL E. BAKKE, General Counsel. |