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105th Congress                                            Rept. 105-308
                        HOUSE OF REPRESENTATIVES

 1st Session                                                     Part 1
_______________________________________________________________________


 
  UNITED STATES-TAIWAN ANTI-BALLISTIC MISSILE DEFENSE COOPERATION ACT


October 6, 1997.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Gilman, from the Committee on International Relations, submitted 
                             the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 2386]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on International Relations, to whom was 
referred the bill (H.R. 2386) to implement the provisions of 
the Taiwan Relations Act concerning the stability and security 
of Taiwan and United States cooperation with Taiwan on the 
development and acquisition of defensive military articles, 
having considered the same, report favorably thereon with an 
amendment and recommend that the bill as amended do pass.
    The amendment is as follows:
    Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States-Taiwan Anti-Ballistic 
Missile Defense Cooperation Act''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) The stability and security of Taiwan and the balance of 
        power in the Taiwan Strait are key elements for the continued 
        peace and stability of the greater Asia-Pacific region, and the 
        indefinite continuation of such stability and security and 
        balance of power is in the vital national security interest of 
        the United States.
            (2) The People's Republic of China is currently engaged in 
        a comprehensive military modernization campaign that is 
        enhancing the power-projection capabilities of the People's 
        Liberation Army, including the introduction of advanced 
        ballistic and cruise missiles that could alter the current 
        balance of power in the Taiwan Strait and in the greater Asia-
        Pacific region.
            (3) The current lack of transparency in the People's 
        Republic of China military infrastructure and its associated 
        defense establishment and the opaqueness of the comprehensive 
        efforts of the People's Liberation Army to modernize its 
        ballistic and cruise missile programs could spark a regional 
        arms race that would destabilize the East Asia and Western 
        Pacific regions and threaten vital United States national 
        security interests.
            (4) In March 1996, the People's Liberation Army created a 
        temporary, but de facto, blockade of both the international 
        shipping lanes of the Taiwan Strait and the international 
        airspace around Taiwan by conducting live-fire military 
        exercises which included the launch of several advanced, 
        nuclear-capable M-9 ballistic missiles to target areas close to 
        major ports in both the northern and southern areas of Taiwan.
            (5) In March 1996, the locations of People's Liberation 
        Army military activities and M-9 missile target areas nearby to 
        Taiwan's two largest ports, Keelung and Kaohsiung, created a de 
        facto blockade of the Taiwan Strait, international waters and 
        airspace, interfered with United States and international 
        shipping and aviation, and impinged upon the national security 
        interests of the United States, requiring the immediate 
        deployment of two United States aircraft carrier battle groups 
        to the South China Sea.
            (6) The actions of the People's Liberation Army in such 
        close proximity to Taiwan were deliberate attempts to disrupt 
        Taiwan's social and economic stability and were carried out as 
        attempts to intimidate the people of Taiwan during the period 
        leading up to Taiwan's historic first democratic presidential 
        election.
            (7) The early development and deployment of an effective 
        United States theater missile defense system to the Asia-
        Pacific region, and the adjustment of United States policy to 
        include Taiwan, including the Penghu Islands, Kinmen, and 
        Matsu, under the protection of such defense system, would be 
        prudent and appropriate responses to--
                    (A) the refusal by the People's Republic of China 
                to renounce the use of force to determine the future of 
                Taiwan;
                    (B) the nature of the military threat of the 
                People's Republic of China posed by the increased focus 
                of the People's Liberation Army on advanced missile 
                development; and
                    (C) the demonstrated intent of the Government of 
                the People's Republic of China to use live-fire 
                military exercises and ballistic missile tests against 
                the people and Government of Taiwan as tools of so-
                called coercive diplomacy.
            (8) The early deployment of a United States theater anti-
        ballistic missile system in the Asia-Pacific region would 
        maintain a balance of power in the Taiwan Strait and deter the 
        People's Republic of China from resorting to military 
        intimidation tactics to coerce or manipulate the people and 
        freely-elected Government of Taiwan in the future.
            (9) Taiwan's local air-defense capability provided by the 
        United States Modified Air Defense System (MADS) is not 
        adequate for the task of defending local areas of Taiwan, 
        including the Penghu Islands, Kinmen, and Matsu, from limited 
        ballistic missile attacks or deterring the threat and use of 
        force against Taiwan by the People's Liberation Army to achieve 
        the political goals of the core leadership of the People's 
        Republic of China.
            (10) Taiwan has requested further United States cooperation 
        on missile defense, including the conduct of a joint 
        architecture study of the requirements for the establishment 
        and operation of a missile defense system for Taiwan, including 
        the Penghu Islands, Kinmen, and Matsu.

SEC. 3. STUDY AND REPORT RELATING TO ESTABLISHMENT AND OPERATION OF A 
                    THEATER BALLISTIC MISSILE DEFENSE SYSTEM IN THE 
                    ASIA-PACIFIC REGION.

    (a) Study.--The Secretary of Defense shall carry out a study of the 
architecture requirements for the establishment and operation of a 
theater ballistic missile defense system in the Asia-Pacific region 
that would have the capability to protect Taiwan from ballistic missile 
attacks. The study shall include a description of appropriate measures 
by which the United States would cooperate with Taiwan and provide 
Taiwan with an advanced local-area ballistic missile defense system.
    (b) Report.--Not later than July 1, 1998, the Secretary of Defense 
shall submit to the Committee on National Security of the House of 
Representatives and the Committee on Armed Services of the Senate a 
report containing--
            (1) the results of the study conducted under subsection 
        (a);
            (2) the factors used to obtain such results;
            (3) a description of any existing United States missile 
        defense system that could be transferred to Taiwan in 
        accordance with the Taiwan Relations Act in order to allow 
        Taiwan to provide for its self-defense against limited 
        ballistic missile attacks.
    (c) Form of Report.--The report under subsection (b) shall be 
submitted in both classified and unclassified form.

SEC. 4. TRANSFER OF BALLISTIC MISSILE DEFENSE SYSTEMS TO TAIWAN.

    It is the sense of the Congress that the President, if requested by 
the Government of Taiwan and in accordance with the results of the 
study conducted under section 3, should transfer to the Government of 
Taiwan appropriate defense articles or defense services under the 
foreign military sales program under chapter 2 of the Arms Export 
Control Act (22 U.S.C. 2761 et seq.) for the purpose of establishing 
and operating a local-area ballistic missile defense system to protect 
Taiwan, including the Penghu Islands, Kinmen, and Matsu, against 
limited ballistic missile attacks.

SEC. 5. STATEMENT OF POLICY RELATING TO UNITED STATES THEATER MISSILE 
                    DEFENSES FOR THE ASIA-PACIFIC REGION.

    The Congress declares that it is in the national interest of the 
United States that Taiwan be included in any effort at ballistic 
missile defense cooperation, networking, or interoperability with 
friendly and allied nations in the Asia-Pacific region.

SEC. 6. SENSE OF THE CONGRESS URGING THE PRESIDENT TO MAKE CLEAR TO THE 
                    PEOPLE'S REPUBLIC OF CHINA THE COMMITMENT OF THE 
                    AMERICAN PEOPLE TO SECURITY AND DEMOCRACY IN 
                    TAIWAN.

    It is the sense of the Congress that the Clinton Administration 
should make clear to the leadership of the People's Republic of China, 
the American people's firm commitment for security and democracy for 
the people of Taiwan and that the United States fully expects that the 
resolution of security issues on both sides of the Taiwan Strait will 
be resolved by peaceful means.

                         background and purpose

    H.R. 2386, the U.S.-Taiwan Anti-Ballistic Missile Defense 
Cooperation Act, would implement provisions of the Taiwan 
Relations Act to enhance the stability and security of Taiwan 
and to facilitate U.S. cooperation with Taiwan in the 
development and acquisition of defensive military articles; in 
particular, modern air defense and anti-missile systems.
    The security of Taiwan and the maintenance of a balance of 
power in the Taiwan Strait are key elements for the continued 
peace and stability of the greater Asia-Pacific region. The 
indefinite continuation of such stability and peace in a region 
of vibrant economic growth, expanding international trade and 
emerging democratic societies is a vital national security 
interest of the United States. Therefore, there is a basis for 
cooperation between the U.S. and Taiwan in support of defensive 
measures that will preserve a balance of power capable of 
deterring any resort to force, in particular, any attempt to 
reunite Taiwan with the Chinese mainland by violent means.
    The People's Republic of China (PRC) is currently engaged 
in a comprehensive military modernization campaign that is 
enhancing the power-projection capabilities of the People's 
Liberation Army (PLA). Included in this campaign is the 
development and deployment of ballistic and cruise missiles 
that could alter the current balance of power in the Taiwan 
Strait and in the greater Asia-Pacific region. Besides 
increasing the number of medium and short-range ballistic 
missiles deployed in the region, the PARC is also striving to 
improve its guidance systems, including terminal radar guidance 
and global-positioning technologies. Long-range cruise missiles 
are also under development. The nature and pace of the PRC's 
missile programs could spark a regional arms race that could 
destabilize the region and threaten vital United States 
national security interests.
    In March, 1996, the PLA created a temporary, de facto 
blockade of both the international shipping lanes of the Taiwan 
Strait and the international airspace around Taiwan by 
conducting live-fire military exercises which included the 
launch of several advanced, nuclear-capable M-9 ballistic 
missiles to target zones close to major ports in both the 
northern and southern areas of Taiwan. These included missile 
strikes near Taiwan's two largest ports, Keehung and Kaohsiung. 
This interruption of international shipping and aviation 
impinged upon the national security interests of the United 
States. In response, the United States deployed two aircraft 
carrier battle groups to the South China Sea. Subsequently, the 
U.S. provided the government of Taiwan with Patriot air defense 
systems, which have a limited anti-missile capability.
    The actions of the PLA in March, 1996 were deliberate 
attempts to disrupt Taiwan's social and economic stability and 
to intimidate the people of Taiwan during the period leading up 
to Taiwan's first democratic presidential elections.
    The early development and deployment of an effective U.S. 
theater missile defense system to the Asia-Pacific region, and 
the adjustment of U.S. policy to include Taiwan (including the 
Matsu, Kinmen and Penghu islands) under the protection of such 
a defense system, would be prudent and appropriate. Such an 
early deployment would maintain the balance of power in the 
Taiwan Strait and deter the People's Republic of China from 
resorting to military intimidation tactics or other uses of 
force. The PRC has refused to renounce the use of force to 
determine the future of Taiwan. Furthermore, the rapid 
modernization and expansion of the PLA require that a policy of 
deterrence be adopted to counter these emerging capabilities.
    Taiwan's current local air defense system, provided by the 
U.S., is not adequate to this task. Taiwan has requested 
further U.S. cooperation on missile defense, including the 
conduct of a joint architecture study of the requirements for 
the establishment and operation of a missile defense system. 
H.R. 2386 calls on the Secretary of Defense to carry out such a 
study of the architecture requirements, and to include a 
description of appropriate measures by which the U.S. could 
cooperate with Taiwan and provide Taiwan with an advanced 
local-area ballistic missile defense system.
    H.R. 2386 also expresses the sense of the Congress that the 
President, if requested by the government of Taiwan and if 
consistent with the aforementioned study, should transfer to 
the government of Taiwan appropriate defense articles and 
defense systems for the purpose of establishing and operating a 
local-area ballistic missile system. Furthermore, the bill 
declares that it is in the national interest of the United 
States that Taiwan be included in any effort to establish a 
ballistic missile defense system for the Asia-Pacific region in 
cooperation with other friendly nations and allies.

                            committee action

    H.R. 2386, the U.S.-Taiwan Anti-Ballistic Missile Defense 
Cooperation Act, was introduced September 3, 1997. It was 
referred to the Committee on International Relations and, in 
addition, to the Committee on National Security. The 
introduction of this bill culminated several months of work on 
the subject of how to respond to various provocations by the 
government of the People's Republic of China in ways that 
prudently address specific problems without adding to regional 
tensions of imposing hardships on the common people of China.
    On September 30, 1997, the International Relations 
Committee considered and marked up the measure, adopting it by 
voice vote as amended, a quorum being present. Three amendments 
were adopted. One amendment, adopted by voice vote, struck 
Section 3 of the bill, which made explicit that the Taiwan 
Relations Act take precedence over any provisions of the Joint 
Communique of the U.S. and China issued in Shanghai on August 
17, 1982. The consensus of the committee was that such a 
statement was not necessary. The Taiwan Relations Act already 
clearly provides the legal framework for the transfer of 
defensive articles and for cooperation between the U.S. and 
Taiwan.
    Indeed, according to Susan Shirk, the Deputy Assistant 
Secretary of State for East Asia, who represented the Clinton 
Administration's position in testimony at the mark-up session, 
such cooperation is already underway and consistent with U.S. 
policy in the Asia-Pacific region. The U.S. is currently 
holding seminars with Taiwan on air and missile defense issues. 
Furthermore, Taiwan has purchased the first three of eight 
ordered batteries of PAC-II Modified Air DefenseSystems which 
have an anti-ballistic missile defense capability.
    In addition, the Committee adopted, by voice vote, an 
amendment by Representative Rohrabacher, adding language 
expressing the Sense of the Congress urging that the President 
to make clear to the People's Republic of China the commitment 
of the American people to security and democracy in Taiwan.
    Just prior to reporting the bill, the Committee adopted, by 
unanimous consent, a Gilman amendment in the nature of a 
substitute consisting of the text of the bill as it had been 
amended through that point.

                      committee oversight findings

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the Committee reports 
the findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

         committee on government reform and oversight findings

    No findings or recommendations of the Committee on 
Government Reform and Oversight were received as referred to in 
clause 2(l)(3)(D) of rule XI of the Rules of the House of 
Representatives.

               new budget authority and tax expenditures

    The Committee adopts the cost estimate of the Congressional 
Budget Office, set out below, as its submission of any required 
information on new budget authority, new spending authority, 
new credit authority, or an increase or decrease in the 
national debt required by clause 2(l)(3)(B) of rule XI of the 
Rules of the House of Representatives.

                       federal mandates statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      advisory committee statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                applicability to the legislative branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

                   constitutional authority statement

    In compliance with clause 2(l)(4) of rule XI of the Rules 
of the House of Representatives, the Committee cites the 
following specific powers granted to the Congress in the 
Constitution as authority for enactment of H.R. 2386 as 
reported by the Committee: Article I, section 8, clause 3 
(relating to the regulation of commerce with foreign nations 
and among the several states); and Article I, section 8, clause 
18 (relating to making all laws necessary and proper for 
carrying into execution powers vested by the Constitution in 
the government of the United States).

               congressional budget office cost estimate

    In compliance with clause 2(l)(3)(C) of rule XI of the 
Rules of the House of Representatives, the Committee sets forth 
with respect to H.R. 2386 as reported by the Committee the 
following estimate and comparison prepared by the Director of 
the Congressional Budget Office under section 403 of the Budget 
Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, October 6, 1997.
Hon. Benjamin A. Gilman,
Chairman, Committee on International Relations,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2386, the United 
States-Taiwan Anti-Ballistic Missile Defense Cooperation Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Joseph C. 
Whitehill.
            Sincerely,
                                         June E. O'Neill, Director.
    Enclosure.

H.R. 2386--United States-Taiwan Anti-Ballistic Missile Defense 
        Cooperation Act

    The bill would require the Department of Defense to conduct 
a study of the architecture requirements for establishing and 
operating a theater defense system capable of protecting Taiwan 
from ballistic missile attack.
    Based on information from the Department of Defense, CBO 
estimates that the architecture study would cost less than 
$500,000, assuming the appropriation of the necessary funds. 
Because the bill would not affect direct spending or receipts, 
pay-as-you-go procedures would not apply.
    The bill contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act of 1995 
and would not affect the budgets of state, local, or tribal 
governments.
    The estimate was prepared by Joseph C. Whitehill. The 
estimate was approved by Robert A. Sunshine, Deputy Assistant 
Director for Budget Analysis.

                jurisdictional issues and other matters

    This legislation has been referred in addition to the 
Committee on National Security.

                    Committee on National Security,
                                  House of Representatives,
                                Washington, DC, September 26, 1997.
Hon. Newt Gingrich,
The Speaker, The Capitol,
House of Representatives, Washington, DC.
    Dear Mr. Speaker: I write with respect to H.R. 2188, a bill 
concerning the tariff treatment of commercial activities 
undertaken by communist Chinese military organizations, and 
H.R. 2386, the United States-Taiwan Anti-Ballistic Missile 
Defense Cooperation Act. Both of these bills have been referred 
to the Committee on National Security, in addition to other 
committees.
    The Committee on National Security has reviewed H.R. 2188 
and H.R. 2386 and, in order to expedite consideration of these 
measures in the House, waives its right to take up both pieces 
of legislation. I therefore ask that the committee be 
discharged from further consideration.
    The Committee on National Security wishes to make clear 
that the foregoing waiver should not be construed as a waiver 
of the committee's jurisdiction with respect to any of the 
legislative provisions in H.R. 2188 and H.R. 2386 that fall 
within its jurisdiction. The committee also wishes to preserve 
its prerogatives concerning any House-Senate conference on 
these bills and any Senate amendments thereto, including the 
appointment of conferees with respect to the provisions of the 
bills which fall within this committee's jurisdiction.
    Thank you for your attention to this matter.
    With warm personal regards, I am
            Sincerely,
                                         Floyd D. Spence, Chairman.

                      Section-by-Section Analysis

Section 1. Short title

    Provides that the Act may be cited as the ``United States-
Taiwan Anti-Ballistic Missile Defense Cooperation Act''.

Section 2. Findings

    Sets forth relevant findings of Congress, including that 
the indefinite continuation of stability, security, and the 
balance of power in the Taiwan Strait is in the vital national 
security interest of the United States; that the People's 
Republic of China is introducing missiles that could alter the 
balance of power in the Taiwan Strait; that in March 1996 the 
People's Liberation Army used ballistic missile firings to 
create a de facto blockade of the Taiwan Strait; that the 
United States should develop an effective theater missile 
defense system and place Taiwan (including the Penghu Islands, 
Kinmen, and Matsu) under the protection of such a system; and 
that Taiwan has requested further United States cooperation on 
missile defense, including the conduct of a joint architecture 
study for a missile defense system for Taiwan.

Section 3. Study and report relating to establishment and operation of 
        a theater ballistic missile defense system in the Asia-Pacific 
        region

    Directs the Secretary of Defense to carry out a study of 
the architecture requirements for a theater missile defense 
system that could protect Taiwan. Not later than July 1, 1998, 
the Secretary of Defense shall submit to the appropriate 
committees of Congress the results of the study and a 
description of any existing United States ballistic missile 
defense system that could be transferred to Taiwan in 
accordance with the Taiwan Relations Act.

Section 4. Transfer of ballistic missile defense systems to Taiwan

    Expresses the sense of Congress that the President, if 
requested by Taiwan and in accordance with the results of the 
study under section 3, should transfer to Taiwan appropriate 
defense articles or defense services under the foreign military 
sales program for the purpose of operating a local-area 
ballistic missile defense system to protect Taiwan.

Section 5. Statement of policy relating to United States theater 
        missile defenses for the Asia-Pacific region

    Declares it to be in the national interest of the United 
States to include Taiwan in any effort at ballistic missile 
defense cooperation, networking, or interoperability in the 
Asia-Pacific region.

Section 6. Sense of the Congress urging the President to make clear to 
        the People's Republic of China the commitment of the American 
        people to security and democracy in Taiwan

    Expresses the sense of Congress that the Clinton 
Administration should make clear to the leadership of the 
People's Republic of China the American people's firm 
commitment for security and democracy for the people of Taiwan, 
and that the United States fully expects that security issues 
on both sides of the Taiwan Strait will be resolved by peaceful 
means.

                            DISSENTING VIEWS

    This resolution mandates a Department of Defense study of 
the architecture requirements for the establishment and 
operation of a theater ballistic missile defense (BMD) system 
that would include Taiwan, and declares, as a sense of the 
Congress, that the President, if requested by the government of 
Taiwan, should make a BMD system available to Taiwan.
    This resolution is flawed both substantively and 
procedurally. While this bill was improved through the 
amendment process, it retains its core serious substantive 
problems:
    First, it is illogical for the bill to mandate a study and 
Presidential report concerning the establishment of a theater 
BMD system that includes Taiwan, while urging the President, 
without waiting for the results of the study, to make such a 
system available to Taiwan.
    Second, inasmuch as China regards Taiwan as an integral 
part of the People's Republic of China, the offer to Taiwan of 
some of the world's most advanced weaponry appears deliberately 
designed to provoke China.
    Third, Taiwan does not need this technology, and may not 
even want it. The U.S. Department of Defense already has an 
ongoing BMD program with Taiwan and has sold Taiwan a Patriot 
derivative (PAC-3) that is comparable to a system that is so 
advanced that it has been introduced into the U.S. Army only in 
the past year. Moreover, senior Taiwanese military leaders are 
reluctant to commit substantial financial resources for 
unproved BMD technology.
    In short, this bill is simultaneously provocative and 
unnecessary. It carries risk, with no prospect for benefit. It 
will reduce rather than enhance the security of our friends on 
Taiwan.
    Procedurally, the process followed by the Committee in 
marking up this resolution was most unfortunate.
    First, the process did not reflect the way a responsible 
committee should operate. Members and staff were not given 
adequate notice to study this resolution, even though it deals 
with serious issues that could have a major adverse impact on 
the upcoming summit meeting with the Chinese president. The 
usual requirement of one week's notice for a mark up was 
reduced to barely more than 24 hours. No unusual or emergency 
circumstances exist that warranted waiving the customary one-
week rule. No committee hearings have been held on this 
resolution, nor were any senior Administration officials 
permitted to testify on the policy implications of this 
resolution prior to the mark up.
    Second, this resolution is badly timed. It does not enhance 
the ability of the President to advance U.S. non-proliferation 
goals at the upcoming U.S.-China summit, the first official 
U.S.-China summit in over eight years. It is counterproductive 
for the Committee--on the basis of hasty deliberation and 
inadequate consultation with the Executive branch--to condemn 
Chinese actions and criticize Administration policy, since this 
approach is unlikely to persuade the Chinese that the Congress 
is serious about its commitment to nonproliferation. Adoption 
of this resolution will make the President's job more difficult 
as he attempts to persuade the Chinese to halt the transfer to 
Iran of dangerous weapons. The Congress should be working with 
the President to help make the summit successful, not passing 
bills to put obstacles in his way, and to create the impression 
that the Congress is moving in one direction and the President 
the other in China policy.
    Finally, the cumulative impact of five resolutions on China 
marked up and voted out of Committee as a package--plus others 
that are circulating and may come to the Floor simultaneously 
with these five--is likely to be harmful to U.S. foreign policy 
interests. Congress of course has every right to express its 
views on these important issues. Nonetheless, when this many 
resolutions each with a strongly anti Chinese tilt suddenly 
come forward simultaneously, and only weeks before a summit 
meeting, it is difficult to escape the conclusion that 
considerations other than foreign policy are also at work here. 
The Chinese-American relationship will not advance if it 
becomes a game board for the purpose of scoring points of 
perceived domestic political advantage.

                                   Lee H. Hamilton.
                                   Gary L. Ackerman.
                                   Amo Houghton.
                                   Bob Clement.