GATT BILL GOES UP THE HILL THIS WEEK; DOLE SAYS IT’LL PASS
Byline: Joyce Barrett
WASHINGTON — Congress is expected to end months of political wrangling this week when it returns for a lame duck session to take up the bill implementing the GATT Uruguay Round, which slashes tariffs and quotas worldwide and has been described as the biggest free-trade pact in history.
Senate minority leader Robert Dole (R., Kan.), who withheld his support until last Wednesday, predicted on Sunday that the agreement would be ratified.
The House is expected to vote
Tuesday and the Senate is to follow on Thursday.
For textiles and apparel, the plan would significantly liberalize trade by phasing out the Multi-Fiber Arrangement over 10 years; cutting tariffs an average of 11.6 percent, and changing rules to designate the country where apparel is sewn as the point of origin.
Retailers — who took themselves out of the battle over GATT in September, when the rule-of-origin change was added to the implementing bill — are expected to decide today whether to rejoin the massive lobbying effort to support the pact.
“We are still very upset and very opposed to the rule of origin,” Robert Hall, vice president, government affairs counsel for the National Retail Federation, said. “However, there are long-term benefits to consumers and retailers for GATT to pass this year, and if it doesn’t, the scenario for next year is very unclear.” Hall said the NRF had been asked by officials from the administration, Capitol Hill and the industry to reenter the fight.
Dole, meanwhile, appearing on “Meet the Press,” sent a message to his Senate colleagues that if they support the pact, they also should vote to waive budget rules that require a plan to pay for the first 10 years of tariff cuts. The administration, in consultation with the House and Senate, has devised a plan to pay for the first five years and is seeking to waive the costs of the second five.
Dole’s backing is key to GATT passage since many undecided members of the Senate are likely to follow his lead. “If you support GATT you should support the budget waiver,” Dole said, adding he thought that ultimately, backing would be “widespread.”
Treasury Secretary Lloyd Bentsen, appearing on “Face the Nation,” was not as confident of GATT’s passage: “It won’t be a slam dunk. We still have some convincing to do.” Bentsen said his fear was that members of the Senate would try to have it “both ways” by saying they favored GATT but opposed the budget waiver.
If Congress approves the accord, it would hand President Clinton a major legislative victory on his ambitious trade agenda, which took off last year with passage of the North American Free Trade Agreement.
Congressional endorsement also is expected to spark rapid approval of the agreement by U.S. trading partners worldwide. The agreement is the result of seven years of intense negotiations. It completely satisfies relatively few industrial sectors, but it’s viewed as the best deal that could be wrought.
Julia Hughes, chairman of the Association of U.S. Importers of Textiles and Apparel, said that while her group had sidelined itself in the debate over GATT, it preferred a vote this year. “Much of the agreement could unravel if it’s delayed,” she said in a telephone interview. “Passage this year is very important for U.S. leadership and the international community.”
While the American Textile Manufacturers Institute has maintained it is neither for nor against GATT despite its delight in the rule-of-origin change, executives from several U.S. firms are expected to come here this week to lobby Congress for the pact, said ATMI president William J. Armfield 4th, vice chair of Unifi Inc., Greensboro, N.C.
An ATMI spokesperson said last week, “It is to the industry’s advantage to have these provisions enacted.”
The American Apparel Manufacturers Association has opposed the implementing bill because it did not include a provision that would have broadened trade benefits in the Caribbean Basin. Larry Martin, who will take over as AAMA president next month, said, “It would be good to get the vote over with.”
If consideration of the GATT bill had been delayed until next year, Martin said, the AAMA would have been among those groups lined up to change it. As it now stands, the AAMA will pursue its quest for Caribbean parity with Mexico when the 104th Congress convenes.
Textile magnate Roger Milliken, ceo of Milliken Co., Spartanburg, S.C., has been striving nationwide to defeat the GATT, primarily because of his opposition to the World Trade Organization, which, under GATT, will function as the new ruling body governing international trade. Milliken’s Washington counsel, Jock Nash, said last week that they were “enormously disappointed” with the deal struck between the White House and Dole. “We’re not trying to fix GATT,” Nash said. “We want to get out of the WTO.”
The timing of this week’s vote was uncertain until Wednesday, when Clinton and Dole reached agreement on several items to which Dole had objected in the GATT. Until then, Dole was threatening to withhold his support, which the administration viewed as key to winning Senate passage.
In a Rose Garden announcement, Dole said the GATT “had been fixed as much as it could be,” and added, “My goal was to fix it, not to kill it.”
The remedy answers some, but not all of Dole’s concerns. He failed to persuade the administration to vow 1995 action on a capital gains tax cut in exchange for his GATT backing. In a letter to Dole last week, Treasury Secretary Bentsen said any proposals on such a tax cut would be “carefully reviewed.”
While many said Dole’s backing was enough to secure GATT passage, others remained cautious. Even Dole was not sanguine about the odds of mustering the 60 Senate votes needed to overcome a technical point on whether Congress can waive the costs of GATT. Last week, he said the vote count was “still fairly close,” explaining, “Many senators have not made up their minds.”
Dole also criticized business for its lobbying effort on behalf of GATT and said some sectors did not plan to start their lobbying push until today, just days before the Senate votes. Dole promised, however, to write all of his Senate Republican colleagues to urge them to support GATT. “This should be a big, big vote, not a narrow vote,” he said. Dole said his primary concern with GATT was what he perceived as the threat to U.S. sovereignty under the WTO and said his office was receiving up to 2,000 calls daily from citizens with the same fears. The administration has agreed to support legislation next year that would create an independent five-person commission composed of appellate judges to review WTO rulings, and after three rulings are issued deemed adverse to U.S. trade practices, the commission could recommend to Congress U.S. withdrawal from the WTO.
The administration also agreed to back 1995 legislation that would extend the terms of patent protection under the Uruguay Round.