NRF IN THE RING AGAIN, FIGHTING HARD FOR GATT
Byline: Joyce Barrett With contributions from Jim Ostroff
WASHINGTON — After sitting on the sidelines since September, the National Retail Federation jumped back into the fray Monday to lobby for passage of the GATT Uruguay Round.
With the worldwide trade agreement expected to win approval easily today in the House, the NRF is directing its efforts at the Senate, where GATT’s survival chances have been considerably slimmer since the Clinton administration unveiled its implementing legislation for the pact. The Senate is expected to vote on GATT Thursday.
In lobbying for GATT, the NRF recognizes the importance to its industry of GATT’s call for a open global economy, bringing into play momentous shifts in the textile and apparel trade. At the same time, the retailers are overcoming their aversion to a provision inserted into the legislation by the administration to change an import rule for apparel, shifting country of origin to where the apparel is assembled from where it is cut. This change, done at the behest of the domestic textile and apparel industries, will have a disruptive and costly effect on established sourcing patterns, the retailers argue.
“Up until this point, our industry had been withholding our full support of the legislation because of an extraneous textile and apparel rule-of-origin amendment attached to the legislation by the administration,” some 24 top retail executives will say in a letter to be hand-delivered today to every senator.
“While we are still strongly opposed to this amendment, we believe on balance the entire legislative proposal merits passage by Congress this year. The United States simply cannot afford to step backwards in its quest for a more open global trading system.”
In anticipation of the GATT agreement increasing U.S. economic activity by $120 billion yearly, the retailers’ letter says, “America’s consumers will undoubtedly benefit from the 10-year phaseout of the Multi-Fiber Arrangement, the centerpiece of a complex network of current import protectionist measures that forces consumers to pay an additional $46 billion a year for textile and apparel products.
“The agreement also provides for the elimination or reduction of tariffs on a wide range of consumer products, as well as the removal of foreign barriers to the expansion of U.S. exports and services abroad, such as retailing,” the letter says.
The letter was being circulated Monday by the NRF for signatures, and by late Monday, close to two dozen retailers had signed. They included Bernard Brennan, chairman and chief executive officer of Montgomery Ward, as well as chairman of the NRF board; Donald G. Fisher, ceo, The Gap; Thomas Hays, deputy chairman, The May Department Stores Co.; Arthur C. Martinez, chairman and ceo, Sears Merchandise Group; Robert E.M. Nourse, president and ceo, The Bombay Co.; John J. Shea, vice chairman, president and ceo, Spiegel Inc., and Robert J. Tarr Jr., president and ceo, Neiman Marcus Group.
The International Mass Retail Association, on the other hand, has no plans to lobby for the agreement, despite the fact that some of its member companies, such as Home Depot, are mustering grass-roots support for it.
“They will win GATT without IMRA, I suppose,” said Robin Lanier, IMRA vice president for international trade. “We are still on the sidelines, but we have been talking to our companies that are lobbying themselves.”
The American Textile Manufacturers Institute was maintaining its neutral stance on GATT, although a spokeswoman noted that ATMI members were “keeping in touch” with their Congressional representatives to insure that GATT is voted on this week.
The U.S. Importers of Textiles and Apparel, also angered by the rule-of-origin change, was staying on the sidelines, said chairwoman Julia Hughes. “No one in the administration has offered anyone a reason to do otherwise,” she said.
The House will debate the measure just four hours today before it votes. The Senate will begin 20 hours of debate Wednesday and vote Thursday.
Hundreds of members of the Alliance for GATT Now, a coalition of more than 200,000 companies, descended Monday on Capitol Hill to press for GATT passage and met with House trade leaders Rep. Sam Gibbons (D., Fla.), acting chairman of the House Ways and Means Committee, and Rep. Bob Matsui (D., Calif.), chairman of the House Trade Subcommittee. Matsui said Monday that GATT would do “very, very well in the House.”
Also on Monday, President Clinton made a final push for GATT. Speaking from the White House East Room to present and former Cabinet officials dating back to the Truman administration, Congressional leaders, trade officials and Nobel laureates, Clinton said the accord would generate $1,700 in additional annual income for the average U.S. family and urged Congress to put aside partisan politics.
The President was flanked by former Secretary of State James Baker 3rd, who served both the Reagan and Bush White Houses, and James Miller 3rd, Reagan’s first Office of Management and Budget director.
Clinton said the battle to enact GATT, like last fall’s imbroglio over the North American Free Trade Agreement, would be viewed in the future as a watershed in American history.
He acknowledged some fear that enactment of GATT, creating a World Trade Organization — whose provisions include phasing out textile and apparel import quotas over 10 years — would cost American jobs.
“If we don’t do anything, we will have the same displacement in the U.S. job market,” he said, but gain no jobs created by new export opportunities.
He implored Congress not to be taken in by arguments of some, such as Sens. Ernest F. Hollings (D., S.C.) and Jesse Helms (R., N.C.), who urge Congress to delay debate until after the new Congress is seated in January. “We have to do it now. We can’t wait until next year,” he said.
Baker added, “Everyone knows that a vote to delay is a vote to kill.” GATT’s enactment, he said, would send a signal to world markets “that the U.S. is willing to compete,” while sending positive signs to Wall Street.
Miller said that within a decade, the accord would add $150 billion to the U.S.’s Gross Domestic Product and create 500,000 new jobs. Consequently, he urged Senators to vote to waive its rule that requires revenue-losing bills — such as GATT, with its cut in tariffs — to be offset by spending cuts or new revenues for 10 years. The White House submitted a five-year offset program, consistent with the House’s requirements.