President Plays Let’s Make a Deal as NAFTA Vote Nears : Trade: Behind door No. 1 is a Maytag tariff. Behind door No. 2, a fruit pact. Clinton haggles, but with limits.
When officials at Maytag and Amana, Iowa’s big home appliance manufacturers, reviewed the North American Free Trade Agreement, they saw that it carried some threatening fine print: an obscure provision that would benefit their major U.S. rivals, General Electric and Whirlpool.
Under the trade pact, GE and Whirlpool, which have plants in Mexico, could continue to import appliances into the United States duty free, a benefit they now enjoy on a temporary basis. But under NAFTA, Amana and Maytag, which produce appliances in Iowa factories, still would have to pay Mexican tariffs on goods exported there for at least another 10 years.
It didn’t take long for Iowa’s congressional delegation to raise a ruckus over the issue with the Clinton Administration. And it didn’t take long for the White House to respond.
In a letter of understanding between Mexican and U.S. trade officials, the two sides agreed to renegotiate home appliance tariff provisions once NAFTA goes into effect. Better yet, the Administration moved quickly enough so that Rep. Fred Grandy (R-Iowa) could announce on Iowa television last week that Clinton was meeting the delegation’s concerns.
The arrangement was just one of many such deals President Clinton has made in recent weeks. In his uphill battle to win congressional approval for the controversial free trade agreement with Mexico and Canada, Clinton has turned once again to the practice of feverish wheeling and dealing for votes that highlighted his budget negotiations with Congress last summer.
Yet Administration officials say there is one key difference this time: Clinton is not quite so willing to give away the store to put NAFTA over the top.
To win his critical budget battle, Clinton engaged in expensive horse-trading on a wide range of issues in the days before the final votes, granting pork-barrel deals and making important legislative promises to key lawmakers.
But now with the federal purse strings drawn ever tighter by Clinton’s own deficit reduction package, there is less money to hand out to win votes.
“We’re talking millions, not billions this time,” quipped one Administration official. Settling the Iowa objections, for example, did not cost any money and did not force the United States to reopen the trade agreement itself.
In addition, the Administration learned lessons from the budget fight and is now taking tougher stances in its private meetings with lawmakers. Congressional sources say Clinton no longer seems reluctant to strong-arm fence-sitters.
Wednesday morning, for example, Rep. Henry A. Waxman (D-Los Angeles), who remains undecided, was brought into the White House for a private hourlong session with Clinton and Vice President Al Gore to hear their case for NAFTA. “It was a very strong sell,” a Waxman aide noted.
“I’ve gotten more attention from the Administration on this than anything else,” added Rep. Bob Filner (D-San Diego), a freshman who remains strongly opposed to NAFTA despite visits and phone calls from U.S. Trade Representative Mickey Kantor, Treasury Secretary Lloyd Bentsen, Interior Secretary Bruce Babbitt and EPA Administrator Carol Browner.
Another target of Clinton’s heat is Rep. Thomas C. Sawyer, a Democrat from Akron, Ohio. There is talk now within the Administration of sending Clinton to Akron to make a speech that would put direct pressure on the undecided Sawyer.
“They’re throwing the kitchen sink at him,” one source said.
The result, sources say, is a more focused White House bargaining strategy. Now, Administration and congressional sources say virtually all deals the Administration has cut to win votes are directly related to NAFTA. And few will require new federal spending.
“I don’t think you are seeing nearly the deal-making that you did in the budget,” noted one senior Administration official. “The issues are narrower, and the Administration’s being tougher.”
“They don’t have a lot of money to offer, because of the budget constraints, and they can’t change the actual agreement, so they are making deals on the margins,” observed Mark Anderson, director of the AFL-CIO’s task force on trade, organized labor’s anti-NAFTA answer to the Clinton Administration’s pro-NAFTA “war room” at the White House.
Many no-cost deals with key lawmakers with particular regional concerns have been cut along the lines of the home appliance agreement. In each case the Administration has promised to reopen trade talks after NAFTA’s passage.
Late last week, for example, Sen. John B. Breaux (D-La.) and Sen. J. Bennett Johnston (D-La.) announced their support for NAFTA after the Administration and Mexican officials agreed to renegotiate the agreement’s sugar trade provisions.
One story making the rounds in Washington last week had an unnamed House member from Illinois who, upon learning that First Lady Hillary Rodham Clinton would visit his district, held out his support for NAFTA until determining that she would say kind things about him in her speech. Getting that assurance, he upped the ante: He wanted to make sure she would stop by his home, to pose for pictures with his wife and baby.
“We’re talking about U.S. relations with Mexico for the next 30 years,” a source said in amazement.
Some Republican support in the House came after Clinton made another nearly painless pledge: to denounce efforts next year by Democratic challengers to attack Republican incumbents for supporting NAFTA.
That’s not to say, however, that plenty of lawmakers haven’t been looking for better deals. In a sense, Clinton has had to try to live down the reputation he earned during the budget for being an easy mark during pork-barrel bargaining.
One Republican closely attuned to Congress and the campaign for the trade pact said that House members who have not declared their intentions “are asking for everything.”
“You hold out until the end,” said a Republican. “The cash register is open with this guy.”
Lobbyists say they believe at least 75 to 80 House members are still undecided, with Democratic leaders saying they are 30 to 40 votes short of the number needed. The House is to vote Nov. 17.
Sources suggest that one reason so many lawmakers remain undecided is the widespread belief that they will get better deals right before the deadline. For example, one pro-NAFTA lobbyist notes that 10 to 12 Florida House members are still undecided in spite of the Administration’s announcement of a new side agreement dealing with citrus fruit last week.
In 1981, by contrast, when President Ronald Reagan’s White House aides needed eight votes from sugar-state members of Congress for a budget bill, they lined up the votes--firmly--before presenting the details of the deal to Reagan. In other words, they managed to get the members of the House on the hook before making any commitments themselves.
Clinton, on the other hand, got a commitment from Mexico on citrus before making certain that the deal would be sweet enough to entice House members. Now, those members are still in a position to ask for more.
Still, the Administration has shown greater creativity than it did during last summer’s budget fight. In one of the largest NAFTA-related deals it has made, the White House agreed to set up a $450-million North American Development Bank to fund community development efforts in areas hurt by trade with Mexico.
In return, the Administration quickly won the support of Rep. Esteban E. Torres (D-La Puente). The bank agreement also played a role in persuading Rep. Nancy Pelosi (D-San Francisco) and Rep. Karan English (D-Ariz.) to endorse NAFTA late last week.
Administration officials say the new bank will not require new federal funding for NAFTA. Instead, the U.S. funding will come from money already earmarked for NAFTA-related environmental border cleanup work, and the bank will finance such projects. In addition, 10% of those funds will be diverted to non-border projects, such as bailing out small firms hit by Mexican imports.
“In this case, it really cost us nothing,” insisted one Administration official.
Yet with a strange and fluid anti-NAFTA coalition building grass-roots support--a coalition that has thrown together such strange bedfellows as Texas billionaire Ross Perot, consumer advocate Ralph Nader and AFL-CIO President Lane Kirkland--even the most inventive deals may not put Clinton over the top.
“I don’t care how much the Administration wheels and deals, this is going to be the first trade agreement decided outside the Beltway, in the districts, not in Washington, because this is a profoundly unpopular issue,” insisted the AFL-CIO’s Anderson. “People instinctively understand this; they have an uncle or a brother who has been laid off by companies moving to Mexico.”
Times staff writer Karen Tumulty contributed to this story.
* FREE TRADE PITCH: President Clinton says NAFTA opponents are motivated by “fear, not facts.” A22
