Reagan, Under Pressure, May Back Trade Bill

Times Staff Writers

The Reagan Administration has responded to a rising tide of political pressure and agreed to support some form of trade legislation in an effort to avert drastic protectionist measures, Republican congressional leaders said Tuesday.

The Administration “has finally recognized that so many, many members” are worried about the impact of the nation’s huge trade deficit on businesses and workers, House Minority Leader Robert H. Michel (R-Ill.) said after GOP leaders met with White House Chief of Staff Donald T. Regan.

Nonetheless, Michel warned that “if they don’t do enough, our members are of such a mind that they’ll do something more.”

Turnabout for Administration


The new White House willingness to consider supporting trade legislation is an abrupt turnabout from its position that the President already had sufficient authority to deal with trade problems. As late as Saturday, President Reagan apparently had hoped to mollify congressional critics with his announcement that he would work to obtain greater access to the Japanese, South Korean and Brazilian markets for certain American goods.

Michel said that the White House will accept most items on a lengthy list of House Republican proposals for a trade bill, including payments to displaced workers for job retraining, expanded presidential powers to retaliate quickly against foreign nations that engage in unfair trade practices and ending the prohibition on the sale of Alaskan North Slope oil to Japan.

Now, the Administration’s difficult task is to craft a trade measure that will persuade members of Congress to abandon their enthusiasm for much more restrictive measures, such as a proposal to cut back sharply on imports of Asian textiles and apparel.

Meanwhile, domestic grape growers and wine makers Tuesday joined the swelling ranks of American businesses seeking government relief from import competi tion as they charged Italy, France and Germany with “dumping” wine in this country at unfairly low prices.


California grape growers lost $300 million last year because European “ordinary table wines"--those selling at $1.99 to $4.99 for a 750-milliliter bottle--were sold in this country at half their actual cost of production, the U.S. producers said.

Regan visited Capitol Hill Tuesday because Republican legislators have been increasingly worried about Democrats’ determination to make trade a major issue in the 1986 elections. But, after speaking with Regan, the top Republicans were able to “feel pretty good about getting out in front on the trade issue,” Senate Majority Leader Bob Dole (R-Kan.) said.

Stronger Steps Possible

But, like Michel, Dole cautioned that an Administration-backed trade bill may not forestall stronger steps by Congress. “There are some bills we may just want to vote on,” he said.


The White House’s new accommodating stance on trade was taken only a day after Reagan’s special trade representative, Clayton Yeutter, had been rebuffed when he asked Dole and Sen. John C. Danforth (R-Mo.) for delays in congressional action on trade bills.

“Basically, it was a plea for time,” said a spokesman for Danforth, chairman of the Senate Finance subcommittee on trade. But Danforth remained unmoved and is determined to press ahead with legislation providing tough trade sanctions against Japan and a measure imposing import quotas on shoes, said the spokesman, Steven Hilton.

The wine makers and grape growers filed their complaint Tuesday with the International Trade Commission and the Commerce Department.

Help for Exports Charged


According to the complaint, Italy, France and West Germany gave their wine exporters financial help worth $875 million last year, including funds for wine storage and for research and development.

Under the spur of foreign competition, American wine makers have been forced to cut their prices and in turn have cut the prices they pay for domestic grapes.

Joseph Vicario, an attorney for the growers, said that a continued flood of unfairly priced imports, whose share of the market has grown to 23%, could wipe out a significant number of American wine producers and grape growers.