year, is for 1 million small cars. Pontiac has said it is looking at importing cars from Daewoo in Korea. If all that comes to pass, and by the time the rest of us get through following their lead just to stay alive, U.S. auto plants are going to fall like dominoes.

I hope you do not have one in your district, but they are. Right now, I have got to face a decision on whether or not to build a small car in Belvidere, IL. Before I put up $600 million to tool that car, I have got to know if GM is going to be allowed to get away with its Japanese strategy: I need to know what the rules are. If GM is given carte blanche to carve up the market, and if our Government says forget about restraints, which they could, and forget about a level playing field so far as export tax rebates and the yen/dollar problem is concerned, then I have got to go overseas too. I have no choice. Neither do the other domestic manufacturers. The net result of this mass exportation will be the loss of another 300,000 American jobs. I have submitted a chart to the committee showing how that is going to happen: the United States is going to lose 300,000 jobs as a result of GM's Japanese strategy.

You know, Mr. Chairman, it is kind of ironic. I fought for restraints on Japanese imports to this country because I knew, I think, in my head but I knew in my heart that unrestrained imports could and would flatten the American economy and kill the infant recovery in its crib. And now, I am here testifying against a proposal that some believe will add a small measure of employment in a town in northern California. Their rationale is, "half a loaf is better than none."

Well, I see it this way: If GM is allowed to proceed with its entire game plan, we are not only going to lose half a loaf today, we are going to lose the whole loaf tomorrow.

And I say to Toyota: Why do you not stop dipping your toe in the water? Take the plunge. Come build cars here on your own, instead of on the cheap. Honda put $300 million into Ohio, and is now going to put in $250 million more. Nissan put $600 million into Tennessee. What makes Toyota-big, debt-free Toyota-the second biggest car and truck maker in the world-think it should only chip in with $150 million in California?

Mr. Chairman, I submit that when you put it all together, the Fremont proposal flunks the test of commonsense on every count: legality, economics, employment, and benefit to the consumer. Perhaps most of all, it represents industrial policy, an ad hoc policy, at its worst, made in secret, without a single public hearing. followed by an effort to disqualify Chrysler's attempt to get at the facts in court. Is that the democratic process? If it is now, it was not 4 years ago.

What a contrast to the spotlight that Chrysler endured, here in Congress, during the loan guarantee debates. We had public hearings here every day, in this very building, and then went on television, night after night, defending what had been said here. The American people heard the facts and, through their elected representatives, got to vote on those facts.

But the FTC's GM-Toyota decision-which is even more important to the future of the auto business and of this country than the Chrysler loan guarantees-was made under a gag rule so tight that two of the Commissioners choked on it, and said so.

I guess the last straw, to me, comes from the GM chairman's statement that we are wasting our stockholders' money in filing suit because we, quote, "Don't have the slightest idea what it's all about."

Them is fighting words, right?

Well, that is our purpose in going to court and in appearing here today. We are trying to find out what it is all about. We are trying to fill in some of the blanks in this book that the FTC released. Look at it. It looks like a censor in the Kremlin was at it.

I took the interesting passages.

One subject chapter, coordinating pricing, it starts off, "Particular incidents of information-sharing are illustrative of this problem," and I know the FTC rules, that they are not compelled.

I am not trying to change the rules, but I am seeking to find how do you get at what is being said.

"This problem is very worrisome."

Then they started blacking out, and they blacked out and left one line, "Of greater concern, though, would be conversations between GM and Toyota concerning retail pricing," and they left the word "continuing" on.

I am a master at reading between the lines, but this is ridiculous. I do not know how poor Calvani who came on and made the swing vote could read the 1,300 pages a day. He must be one quick study.

Let me close by stating, once again and in plain English, that we have to know what the rules are. We have to ask what our alternatives are if the whole GM strategy-of which Fremont is an integral part-prevails.

We do not have many. One would be to get out of the small car business completely and try to build nothing but gas-guzzlers and trucks. A second would be to follow the lead and ship the small car business overseas. A third would be to take the small car R&D money and investment and tooling money and go out and buy a bank. I am not being facetious.

Any of these alternatives which contradict the purposes of the Loan Guarantee Act, which this Congress, led by this House of Representatives, led by many of you as members of this committee, passed in 1979.

You challenged me to go out and build a fuel-efficient fleet and to save 600,000 jobs. With a lot of help, we did it.

Now, we are about to embark on moving a lot of those jobs and a lot of those fuel-efficient cars outside the country. I do not think that is what all of you had in mind.

I do not want to oversimplify, but you see that is the core. If GM is allowed its way, a lot of us have some hard decisions to make, and these decisions can have a major impact on investment and jobs in this country.

If that happens, America will be the loser.

Thank you, Mr. Chairman.

[The charts and statement of Mr. Goodyear follow:]