Bush Proposes Concessions on Free-Trade Plan

President Bush, in an effort to rescue his endangered U.S.-Mexican free-trade proposal, proposed concessions Wednesday on some of the concerns raised by environmentalists and labor--and appeared to win crucial support from key Democrats.

In a letter to lawmakers, Bush reversed his opposition to aiding workers who may lose their jobs as a result of increased imports and said he will work with Congress to come up with a plan to assist those in industries that are hurt by liberalizing trade with Mexico.

At the same time, however, the long-awaited document fell short of meeting other demands by opponents, including one that Washington require Mexico to toughen its environmental laws, so as to discourage U.S. firms from moving to escape American rules.

Even with the apparent shortcomings, however, Bush’s gesture appeared to have blunted some of the threat to the free-trade proposal in Congress, where opponents warn that it will throw thousands of Americans out of work and foul this country’s environment by increasing the outflow of pollution from a more heavily industrialized Mexico.

Almost immediately after the letter was made public, the two lawmakers with the most say over trade legislation--Senate Finance Committee Chairman Lloyd Bentsen (D-Tex.) and House Ways and Means Committee Chairman Dan Rostenkowski (D-Ill.)--expressed support for the President’s approach.

The support of the top Democratic leaders is expected to give a considerable boost to the prospects for a trade agreement, which will face its first hurdle later this month when both houses vote on a procedural question that would clear the way for negotiations to begin. The negotiations will also include Canada, but its role has not been an issue because Canada and the United States already have a free-trade pact.

Also hanging in the balance is the fate of the broader 107-nation “Uruguay Round” of global trade-liberalization talks, for which the Administration will seek negotiating authority in the same legislative package.

Bush’s concessions came in an 80-page response to a March letter from the two chairmen in which they had warned that many in Congress had “legitimate concerns that, in our judgment, should be addressed in a meaningful way” before the congressional vote.

House Majority Leader Richard A. Gephardt (D-Mo.) also had sent Bush a letter spelling out similar reservations.

With the trade talks opposed by an influential coalition of organized labor and some environmental and consumer groups, significantly more than half in Congress have not declared how they will vote. Many said they were waiting to see how the President responded to the letters.

Backers of the agreement argue that free trade will spur the economy on both sides of the border. But critics warn that U.S. workers in many industries will suffer under competition with cheap imports or as their companies move operations south in search of less expensive labor and regulations.

One of the Administration’s most significant compromises was an assurance that it would work with Congress to come up with a program to aid workers who lose their jobs as a result of the agreement.

“This is an evolution in the Administration’s position,” one high-ranking trade official said. Bush in the past has sought to slash funding for certain programs that provide assistance to workers who lose their jobs because of imports.

Bush promised to give environmentalists a voice in trade policy by appointing their representatives to a number of advisory committees. He also pointed to ongoing programs in which the Mexican and U.S. governments are attempting to tackle such problems as pollution along the border.

“The Administration’s strategy represents a positive first step,” said Glenn Prickett, international program associate of the Natural Resources Defense Council, which had insisted that environmental concerns must become part of the talks.

Bush also insisted that Mexican President Carlos Salinas de Gortari has aggressively put forward programs to clean up his country’s environment, provide better working conditions and meet other concerns voiced by opponents. But without the economic growth that a free-trade agreement would provide, it will be more difficult to enforce Mexico’s environmental and labor laws, Bush said.

“President Salinas and the Mexican people have no interest in allowing their country to become a pollution haven for U.S. companies, because economic growth goes hand in hand with environmental protection,” Bush told a gathering of business editors.

Bentsen said Bush’s letter contained “some significant concessions by the Administration. It gives me some comfort on the issues I raised in my letter to the President--and I imagine it will give some comfort to other (lawmakers) as well.”

Rostenkowski praised the President’s arguments as “comprehensive and compelling. I embrace his action and plan.”

Gephardt declined to comment, saying he needed more time to study the response.

The staunchest opponents of the negotiations remained unswayed. Rep. Don J. Pease (D-Ohio) said he was disappointed, and a fellow Ohio Democrat, Rep. Marcy Kaptur, described it as “an empty set of words.”

Administration officials “probably have gone about as far as they could go” to answer congressional concerns, said Rep. Robert T. Matsui (D-Sacramento), who added that he is leaning toward supporting the negotiations.

Yet one congressman, speaking on the condition that he not be identified, said there still is “a lot of skepticism” among lawmakers that the Administration will be able to come through on what it promised.

Some noted that they were concerned by the fact that many of the environmental and labor-related assurances would not be part of the trade pact itself, but rather negotiated on what Administration officials described as a “parallel track.” Skeptics wondered whether it would be possible to enforce such arrangements if they were agreed upon separately.

For all the furor the issue of free trade with Mexico has provoked, it is sometimes easy to lose track of the fact that talks themselves have not even begun. Before the three countries can even go to the negotiating table, Administration officials insist that they and the other two nations must have a guarantee that Congress will not amend any agreement they reach.

The assurance that Congress will accept or reject the free-trade agreement intact--and not alter it with amendments that could start the negotiations all over again--is the subject of this month’s “fast track” vote.

U.S. Trade Representative Carla Anderson Hills noted that exports have been responsible for a significant share of this country’s economic growth in recent years and that trade growth is this country’s best hope of pulling itself out of a recession.

She predicted that the fast-track vote in Congress will be close but said: “I can’t believe that in a year where the majority of our growth comes from exports, I’m going to be permanently grounded.”