Clinton Trade Agenda Draws Steady Barrage From Left, Right

WASHINGTON — As he seeks to launch a new wave of trade initiatives, President Clinton’s international economic agenda is beginning to resemble an island beset by rising water on all sides.

As in education policy, Clinton’s trade agenda is being threatened by an unusual congressional coalition of liberals and conservatives opposing the president for mutually contradictory reasons.

Though most analysts believe that Congress ultimately will pass Clinton’s bid for expedited “fast-track” negotiating authority, the breadth and intensity of the attack on the request have surprised many. In the week since Clinton formally unveiled his plan, liberals and organized labor have accused him of slighting international labor and environmental issues--while conservatives have denounced him for placing too much emphasis on just those concerns.

Clinton himself received a stony reception Wednesday when he pitched his fast-track proposal at the AFL-CIO convention in Pittsburgh. “We cannot create enough good jobs and increase wages if we don’t expand trade,” he insisted.

In response, a handful of union members in the audience called out: “No fast-track.”

Clinton seemed resigned to sustained resistance from labor. In his speech, he urged his listeners not to let this “one issue trump all the others” and cause a rupture between the unions and the Democratic Party.

The left-right marriage of convenience against fast-track--like the similar coalition that united in the House last week to derail Clinton’s plan for national education tests--underscores the difficulty of governing from the center in a highly partisan Congress, even after the bipartisan deal to balance the budget.

But, even more, the stormy reception for fast-track marks the increasing complexity of trade politics as more conservatives join liberals in finding reasons for skepticism about free trade. With trade issues now dividing both parties, free-traders find themselves engaged in fragile balancing acts to build congressional majorities.

“Obviously, if you go anywhere close to the minimally acceptable position for labor, you won’t get Republican support,” said I.M. Destler, a trade expert at the University of Maryland. “If you don’t include anything on labor and the environment, you are going to give the Democrats an excuse to take a walk. . . . That leaves you with a fairly narrow line.”

The fast-track proposal itself seems a rather thin reed to bear the weight of the emotion swirling around it in Washington. The proposal does not seek congressional approval of any specific trade agreement, such as expansion of the North American Free Trade Agreement among the United States, Mexico and Canada.

Rather, fast-track would require Congress to take an up-or-down vote--without amendment--on future trade agreements negotiated by Clinton. Trade negotiators insist that such a streamlined process is necessary to prevent Congress from rewriting bargains struck in painstaking negotiation with foreign countries. In practice, it can be virtually impossible to conclude complex trade agreements without the fast-track procedure--which is why every president since Gerald R. Ford has requested, and received, the authority.

The lightning rod for the current controversy is the extent to which the United States should pressure other nations through trade talks to stiffen their labor and environmental laws.

Organized labor and liberals, led by House Minority Leader Richard A. Gephardt (D-Mo.) argue that the United States should incorporate environmental and labor rights standards directly into trade agreements. Without such protections, they maintain, trade deals will simply encourage U.S. employers to shift production abroad.

Reflecting the skepticism of many multinational businesses, conservatives insist that trade negotiations should focus on tariffs and other barriers to market access and not try to legislate the regulatory systems of other nations.

In designing its fast-track proposal, the administration leaned more toward the latter perspective. Clinton’s legislation would provide him authority to include labor and environmental issues in trade pacts only to the extent they are “directly related to trade.” That tracks closely with language suggested by House Speaker Newt Gingrich (R-Ga.) and House Ways and Means Committee Chairman Bill Archer (R-Texas).

“This was clearly a bill that was designed to placate the Republicans and the business interests in the Democratic Party,” said Bruce Stokes, a senior fellow at the Council on Foreign Relations.

But that did not stop conservatives from denouncing the proposal. In Senate hearings last week, a procession of Republicans led by Sen. Phil Gramm (R-Texas) strafed U.S. Trade Representative Charlene Barshefsky with objections. Archer took a less confrontational position but also insisted that the fine print would leave Clinton too much room to pursue environmental and labor issues.

“As it is presently written, there is no chance the bill is going to pass,” Gramm said in an interview. “We are not giving the president fast-track to negotiate labor agreements and international environmental agreements.”

The fierce GOP reaction has trapped Clinton in a vicious circle that promises to further increase the strain on his party. Since most congressional Democrats--especially in the House--are likely to oppose his request for fast-track, Clinton needs broad support from Republicans to pass the bill. In return for their support, though, Republicans are demanding that Clinton further limit his authority to pursue labor and environmental issues--which makes it more difficult for even centrist Democrats to embrace the bill.

Yet the politics of trade have become so complex that Republicans face limits in this minuet too. Unless they are willing to risk sinking fast-track altogether--which would produce a backlash among businesses--party leaders cannot turn the screw so tightly that they lose too many of the Democrats. The reason: With protectionist sentiments growing in the GOP, Republicans cannot pass the bill without Democratic help.

“If they want to make it a total Republican bill, fine, they should come up with the 218 Republican votes [the bare majority needed in the House],” said one administration official. “But they don’t have the 218 Republican votes.”

What’s most frustrating to administration trade experts is that the argument over labor and environmental standards--while raising significant long-term issues--is largely symbolic in the context of Clinton’s immediate trade agenda.

Barshefsky has said she plans to spend most of her time in coming months negotiating agreements for more liberal trade in individual economic sectors, such as financial services and information technology, where these issues do not arise. “Those are the big-ticket items,” she said.

Moreover, Chile, the next target for a countrywide free-trade deal with the U.S., already has agreed to negotiate side agreements on regulatory issues.

To Republican consternation, Clinton’s proposed bill would commit the administration to promote worker rights through the World Trade Organization, the body that sets international trade rules. But that objective--added to mollify Senate Democrats--is somewhat symbolic too because developing economies have blocked WTO consideration of these questions.

Given the limited practical impact of the argument over labor and the environment, many see the fast-track dispute as a proxy for larger concerns. On the left, it has become a symbol of anxiety over expansion of the global economy that has seen more U.S. companies shift production abroad. For conservatives, resistance to Clinton’s fast-track proposal may be a way to soothe GOP activists demanding more confrontation with the administration--and a bargaining chip to force concessions from Clinton on other issues, such as school choice or the design of the census for 2000.

Though the free-trade position probably retains at least a narrow majority in Congress, the risk to Clinton is that the legislation will capsize amid all of these swirling and contradictory crosscurrents.

“This is an exercise in threading the needle,” said one administration official closely monitoring the debate.