SUNS  4290 Tuesday 29 September 1998


FAST-TRACK DEFEATED IN US CONGRESS

Washington, Sep 25 (IPS/Jim Lobe) -- A major push by big business, agricultural interests, and the Republican Congressional leadership to give President Bill Clinton authority to negotiate new trade agreements with Latin America and other emerging markets fell short Friday.

The House of Representatives voted 180-243 late Friday to defeat "fast-track" legislation, which was opposed by Clinton himself who, only last January, had rated the measure among his top priorities for 1998.

The reason for his switch - and that of a significant number of Democrats who had rallied strongly for fast-track authority in the past - had to do with pure politics, which has become increasingly partisan with the approach of the November mid-term congressional elections.

House Speaker Newt Gingrich had promised corporate contributors that he would bring fast-track to a vote before Congress adjourned on Oct 9. He had hoped to use the vote not only to assure those donors of continued Republican support for their agenda, but also to exploit a damaging split among Democrats over trade issues.

Last year, Clinton was badly embarrassed when three out of every four Democrats, many under strong pressure from labour unions and environmental groups, said they would oppose fast-track. Rather than risk a formal defeat, Clinton withdrew the measure at the last minute.

The president, who still insists that he wants fast-track authority and has vowed to fight for it next year, did not want to repeat that experience so close to the November elections.

When the votes were tallied Friday, fewer than 30 Democrats, most of them from districts with strong agribusiness interests, voted for the measure. At the same time, the Republican leadership fell far short of the 185 votes from its side of the aisle that were needed to win.

Fast-track legislation gives the president authority to negotiate new agreements with U.S. trade partners. Under fast-track rules, Congress may not amend such agreements and must vote either yes or no within 90 days after their submission by the president.

Fast-track authority was approved five times between 1974 and 1994 when the North American Free Trade Agreement (NAFTA) took effect. NAFTA - which was followed in 1995 by a massive, U.S.-orchestrated bailout of Mexico - has been widely unpopular in the United States, where many
believe that it has led to the loss of thousands of jobs.

"NAFTA lost Hoosiers 17,000 jobs, and fast track is more of NAFTA," declared Rep. Tim Roemer during Friday's debate. 'Hoosiers' is the nickname for people from his state, Indiana.

At the top of Clinton's fast-track agenda last year was his proposed Free Trade Area of the Americas (FTAA). Clinton had hoped to launch FTAA negotiations with his Latin American and Caribbean counterparts at the Summit of the Americas in Santiago with fast-track authority in
hand.

But his interest in securing fast track this year quickly faded once it became clear that most Democrats would continue to oppose it without much tougher protection for worker rights and the environment.
Republicans, who are more wedded to free-trade ideology, have strongly opposed the inclusion of such measures.

In the meantime, the spreading Asian financial crisis raged out of control and quickly replaced fast track as Clinton's top foreign economic priority. The administration, which last year committed $18
billion for the International Monetary Fund (IMF), in part to deal with such crises, has pressed Congress to approve the money to help bolster confidence in the global financial system at a critical moment.

Gingrich, however, has played coy about IMF funding, which is still pending, and instead has pushed hard for a fast-track vote both to highlight Clinton's inconsistency and reassure business contributors who have become increasingly concerned that the Republican leadership this year has pursued a populist, Christian Right agenda inconsistent with their interests.

Business groups, notably the Chamber of Commerce and the Business Roundtable - an exclusive group of corporate chieftains of the largest U.S. companies - have lobbied hard for the bill, taking out advertising in newspapers and on television. They have been bolstered this year by big agricultural interests which are reeling from plummeting grain prices and the collapse of key Asian markets as a result of the financial crisis.

Labour, the Democrats' single most important source of campaign funding, and environmental groups also put pressure on "moderate" Republicans who have shown little reluctance in the past to break with their leadership.

Altogether, 71 Republicans, including moderates, a number of Florida congressmen whose constituencies include tomato growers hit hard by NAFTA, and hard-core protectionists from the most conservative wing of the party, joined more than 170 Democrats to defeat the measure by an
even wider margin than most had predicted.

Both the administration and fast track's Democratic supporters had appealed to Gingrich not to bring the measure to a vote. "Should (fast track) fail on the floor of the House, it will send further shock waves to already fragile world markets," three prominent pro-trade Democrats warned to the Speaker last week.

"I would hate to see the bill brought up for failure now," said U.S. Trade Representative Charlene Barshefsky during a lunch here Friday, "because that would prejudice our ability to actually get it on a bipartisan basis (next year)."

But Gingrich persisted, insisting that the global impact of the Asia crisis made fast track and free trade policies more important than ever. "If this goes down, and the world ends up in a deep recession, some of us will have the comfort of knowing that we did the right thing," he warned his Democratic colleagues.

But Democrats countered that the Republican leadership, by forcing the issue when it knew it could not pass, would be responsible for the consequences.

"The Republicans have poisoned the fast-track debate by their partisanship," declared Rep. Jim McDermott, whose district includes heavily hi-tech, export-dependent industries, including Boeing and Microsoft. "You have made passage of this bill infinitely more difficult."