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Congress Comes to Terms on 'Fast-Track' Trade Status for Bush

Pact: Bill would expand presidential authority to seek new international agreements. Breakthrough deal is reached in marathon sessions on Capitol Hill.


WASHINGTON — In a legislative breakthrough for the Bush administration, congressional negotiators announced a deal late Thursday on a bill that would expand presidential authority to seek new international trade agreements.

Terms of an accord to grant President Bush "fast-track" trade authority were finished just before midnight after marathon talks, lawmakers said. The House could vote as early as today on a final version of the bill, with Senate action expected soon afterward.

Securing House passage would be a large feat in an election year; twice in recent months, the House has moved forward on the legislation by a mere one-vote margin. Most House Republicans have voted for the bill, while most Democrats have been opposed.

Rep. William M. Thomas (R-Bakersfield), chairman of the House Ways and Means Committee, and Sen. Max Baucus (D-Mont.), chairman of the Senate Finance Committee, shook hands on the deal late Thursday, with other senior lawmakers also in agreement, aides said.

"We believe we have an agreement," Thomas told reporters afterward.

Michael Siegel, a finance committee spokesman, concurred, saying, "We've got an agreement. This is it."

Baucus, Siegel said, believed the deal represented "a significant victory for American workers, for our economy and also for U.S. trade prestige." The Senate aide said the deal included many Senate-crafted provisions providing federal aid--including a health-insurance subsidy--to workers left jobless in industries vulnerable to foreign trade.

If a bill clears Congress, it would be a huge victory for the Bush administration's economic agenda. It also could stimulate global trade talks launched last year at an international conference in Qatar, as well as jump-starting efforts to create a free trade zone spanning the Western Hemisphere. Those developments would counter a recent trend of protectionism that has dimmed hopes for easing global trade barriers.

The core of the bill at issue would allow Bush to negotiate bilateral, regional or global trade deals and bring them to Congress for approval on an up-or-down vote, with no amendments allowed.

From 1974 to 1994, every president held such power. It was instrumental, for example, in securing approval of the North American Free Trade Agreement, which took effect Jan. 1, 1994, and of the global accord that created the World Trade Organization a year later.

But for the last eight years, presidents have not held fast-track authority. President Clinton, a free-trader, tried and failed to renew it. Bush, likewise in favor of opening markets, made it a priority shortly after he took office last year.

With concerns about the effects of globalization rising in recent years, lawmakers have become increasingly zealous in guarding their role in regulating foreign commerce, a power expressly granted Congress under the Constitution.

Although many lawmakers have sympathized with pleas from the business community to expand presidential trade authority as a way to gain access to foreign markets, others have been deeply suspicious of free trade. These critics say that more U.S. jobs are lost than gained when foreign imports swamp markets here.

The House in December and the Senate in May passed very different versions of the trade bill. Unlike the GOP-drafted House bill, the bipartisan measure that emerged from the Democrat-led Senate would greatly expand federal aid to workers left jobless because of foreign competition. In one key Senate provision, for example, these dislocated workers would be eligible for a federal subsidy of as much as 70% of the cost of their health insurance.

The original House bill contained no such subsidy; subsequently, House GOP leaders embraced a 60% subsidy, but under conditions substantially different from those proposed in the Senate version. In another key sticking point, the Senate bill also included a provision allowing the Senate to amend or remove language that would weaken trade laws protecting domestic industries from unfair foreign competition.

The administration strenuously opposed this provision--known as the Dayton-Craig amendment--as antithetical to fast-track, saying that it would cripple the country's ability to promote trade liberalization around the world because other governments would be unwilling to strike deals that could be picked apart by the Senate.

This week, at Bush's urging, lawmakers accelerated their search for compromise, as Congress is due to break within days for an extended summer recess. On Wednesday and Thursday, Baucus, Thomas and other key negotiators met late into the evening.

Early Thursday, Senate Majority Leader Tom Daschle (D-S.D.) dampened hopes for a breakthrough. Daschle said House GOP offers would not do enough to help displaced workers. A supporter of the Senate bill, which passed 66 to 30, Daschle said he could wait until September or October if necessary to reach an accord.

The White House sharply criticized Daschle's statement and urged lawmakers to press ahead as quickly as possible.

Pro-trade advocates also were applying pressure. Calman Cohen, head of the Emergency Committee for American Trade, said: "At a time when there is extreme nervousness about the state of our markets, the need to do everything that can be done to expand our economy is pressing on these members and the White House."

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