White House Says Plant-Closing Notice Stands in Way of Approval of Trade Bill

The White House said Friday that President Reagan’s objections to the massive trade bill in Congress are lessening but that he will veto it unless a provision is removed that requires employers to give 60 days’ notice of plant closings.

In a statement that generally was conciliatory, White House spokesman Marlin Fitzwater made it clear that only the plant closing provision stands between the bill--one of the top priorities of Democratic leaders in Congress--and presidential approval.

Fitzwater said he hopes that Congress will be willing to reconsider the issue, but House Speaker Jim Wright (D-Tex.) expressed no optimism about a compromise. Many members strongly believe that too many workers have been “left high and dry by sudden dismissal notices,” Wright said in a breakfast interview.

Fate of Bill Uncertain

The impasse leaves the fate of the trade bill uncertain. Democratic leaders on Thursday directed negotiators who are reconciling the House and Senate versions of the measure to complete their work so that both chambers can vote on the massive 1,000-page package. They said that the plant closings provision would be included.

Moves to abandon or dilute the mandatory notice requirement have been strongly opposed by organized labor. “The labor unions apparently would sacrifice the entire trade bill for this provision,” Fitzwater said.

In addition to clouding the prospects for the trade bill, the impasse sets up a political confrontation between Republicans and organized labor during the presidential election campaign.

“There is that (political) side” to the issue, said one former White House official who is close to the campaign of Vice President George Bush. He added that the White House is “very cognizant of the problem” that such a confrontation might pose for GOP efforts to court blue-collar workers.

He said that Republican strategists hope “the problem will be worked out and the bill will be signed.”

The broad, omnibus legislation is designed to revise U.S. international trade laws to help make U.S. industries more competitive in world markets and to protect U.S. workers from foreign competition.

Several major provisions that would have provoked a veto have been removed. These measures, which the White House charged would limit presidential discretion unduly or trigger retaliation from U.S. trading partners, include mandatory sanctions against nations carrying large trade surpluses with the United States and strict penalties for allegedly unfair trade practices.

Fitzwater indicated that the White House is willing to accept all the remaining provisions except the 60-day notice requirement, which he said could force companies to close facilities prematurely.

“It makes it difficult to revive companies” once they have given the notice, he said.

“On the surface this sounds like a humanitarian provision that says you tell people what’s going to happen but in fact it makes it more difficult to get loans, to sell off a division, to take certain actions that might save that part of the company or that company in that last 60 days than would otherwise be the case,” the White House spokesman said.

Supporters of the provision argued, however, that a company could obtain an exemption if it were trying to obtain new financing or to take other steps aimed at saving the operation.

Meeting with reporters Friday morning, Wright said that he proposed shortening the notice period to 45 days or making it applicable only to plants with 500 or more workers. The threshold in the measure is now 100 workers.

But, he said, the White House would not budge in its opposition. Reagan, he said, is “stuck, apparently, on an ideological nail” on the issue.

Said Fitzwater: “The economic concerns of the company are the concerns of the workers. That’s how they get to keep their jobs. Our concern is . . . giving every possibility for the company to stay in business so people can keep their jobs.”

Democrats said that even if the trade bill succumbs to the deadlock, the issue will pay dividends for them.

“It’s a no-lose proposition,” said an aide to Rep. William L. Clay (D-Mo.), chairman of the Education and Labor subcommittee on labor-management relations. Bush, the apparent Republican nominee, is striving in his campaign to retain some of the previously Democratic blue-collar support that helped elect Reagan in 1980 and 1984.