THE REPUBLICAN SWEEP
BUSINESS TALLIES IT UP
Byline: Joyce Barrett With contributions from Jim Ostroff
WASHINGTON — Retailing, apparel and textile interests were busy Wednesday adding up their potential gains in the Republican Party’s stunning takeover of Capitol Hill.
Here’s what many saw:
Victories by every Republican Senate candidate that GOT substantial campaign contributions from retail political action committees, guaranteeing retailers at least an audience for their legislative agendas.
Closer scrutiny of administration trade policies linked to environmental and labor protections — provisions that rile business generally even as it advocates free trade.
A revival of attempts for health care reform but without government-mandated employer contributions, which retailing had fought vigorously.
“This election is good news for business if both parties work in a cooperative fashion to benefit the country,” said John Dill, senior vice president of government affairs for the National Retail Federation.
“This means business will have more confidence,” said Eugene Milosh, president of the American Association of Exporters and Importers. “There were many inconsistencies in the administration’s trade policies.”
Laura Jones, executive director of the U.S. Association of Importers of Textile and Apparel, agreed: “The Republican Party tends to actually listen to business, as opposed to what this administration has done for the past two years. Even the former Congress turned a deaf ear on business.”
The U.S. Chamber of Commerce also touted the change in power. “We believe America has sent a clear message to Congress and the White house that less government, lower taxes and no more excuses are the marching orders,” said Richard L. Lesher, chamber president.
William J. Armfield 4th, president of the American Textile Manufacturers Institute, said the election results “send a clear signal that Americans are looking for a fresh approach and perspective — new ways of solving old problems and moving beyond congressional gridlock.”
Certainly euphoria reigned in certain offices along Seventh Avenue.
“I feel in general that the people have hope now,” said Ken Zimmerman, president of dress and sportswear firm Kenar Enterprises. “There is new blood with the Republicans in control, and I think people have something to look forward to. This might loosen up people’s purse strings because they are more optimistic. “I’m excited about the change. I think with a Republican control of the Senate, we will see a reduction in taxes.” said Jack Weinstock, president of Pacific Silk Co.
Said Abe Chehebar, chief executive officer, Accessory Network, “I’m thrilled by the vote of confidence as exhibited by the sweep of Republican victories across the nation. I believe that people want government to be equally balanced. A difference of opinion makes both sides smarter, and the onus is now on Republicans and Democrats alike to make sure there isn’t a stalemate.”
Not all opinion, though, was clearcut.
Simon J. Critchell, president and chief executive officer of Cartier, said he believes the outcome of the election could be good for the business community, at least in the short term. “Generally speaking, in politics change is a good thing,” he said. “It gives people hope.” Long term, he said, the results are harder to predict. “Whether or not a return to a more Republican form of government will cure the ills President Clinton was trying to solve, I don’t know,” he said.
A. Robert Stevenson, Kmart Corp.’s vice president of public affairs, said: “The whole thing was kind of a surprise. How it translates into issues for retailers is unclear at this point.”
In the Senate, the Republicans now have a 53-47 majority. In the House, the balance of power has shifted significantly. Late Wednesday, the tally showed 226 House Republicans, 199 Democrats, one independent, and nine House races still undecided. That is an increase of 48 Republicans. No Republican incumbents were defeated in the House, Senate or for governor. It’s the first time in 42 years the Republicans have controlled both chambers of Congress.
Whether this new power structure will yield to a spirit of bipartisan cooperation remains to be seen. For example, Linda J. Wachner, chief executive officer of The Warnaco Group, pointed out: “I think we are going to see the President carry his veto more.”
President Clinton himself at a press conference Wednesday hinted he will make the upcoming vote on the GATT agreement for liberalizing world trade a test of his ability to lead in the wake of this overwhelming mid-term election defeat.
Clinton asked the GOP leaders “to join me in the center of the public debate,” adding the two parties “often have joined together when it’s clearly in the national interest.” He said, “For example, they have often chosen to put international affairs above politics.
“I urge them to do so again again by passing the GATT agreement this year,” Clinton said. “Our prosperity depends upon it, and there can be no compromise in the national interest when the livelihood of American households are at stake.”
A vote on legislation to implement the GATT’s Uruguay Round, with its provisions for ending U.S. import quotas on textiles and apparel, is set for for a lame-duck session the week of Nov. 28. Congress was slated to vote on GATT in early October but was happy to delay taking up this contentious issue until after the election. A big question now is whether Republicans will be willing to give Clinton this legislative victory, even in a lame-duck session.
Rep. Newt Gingrich (R., Ga.), expected to become the new Speaker of the House, backs GATT and has pledged to the administration that Republicans will deliver enough votes for pass the agreement when it comes up for the House vote Nov. 30. He helped the administration last year muster votes for North American Free Trade Agreement.
In another press conference Wednesday, Sen. Robert Dole (R., Kan.), who will become Senate Majority Leader when the 104th Congress convenes next year, however, advised President Clinton that he will need to take his case for the GATT agreement to the American people.
Dole has expressed concern about the threat to U.S. sovereignty in the World Trade Organization, which will replace the GATT as the rule-making and dispute-settlement body.
“We’ve had more concern expressed about GATT than we did about the North American Free Trade Agreement,” Dole said. “There needs to be some way to explain what the WTO is.”
While Dole said he is “predisposed” to vote for GATT when it comes up Dec. 1 in the Senate, he said he was still undecided. He added, though, he had no plans to delay the vote.
Dole’s call for a closer look at GATT is just the kind of examination of the administration’s policies welcomed by retailers and importers.
“The Republicans will take a tougher stand on free trade representing business,” said Milosh of the AAEI. “We may have more debates and rumblings, but all things bode well for the Republicans getting trade priorities through.”
Beyond the GATT vote, other initiatives for trade legislation could be delayed by the House Republican Contract with America signed by more than 300 Republican candidates. The contract promises that during the first 100 days of the new Congress, the House GOP will consider bills that would provide a balanced budget and line-item veto; an anti-crime bill; a tax bill to give incentives for education, adoption and child support as well as a tax credit for children; an increase in the Social Security earnings limit; reform of product liability laws, and term limits.
Health care reform is expected to be revived, but without the employer mandates offered by the Clinton administration. Dill of the NRF predicted health care reform would feature market reforms and cost-cutting measures.
“We’re very comfortable there will be no mandates,” Dill said.