New York Times | December 8, 2001 | By JOSEPH KAHN
WASHINGTON - The Bush administration hailed Thursday's photo-finish vote on presidential trade powers as a sterling - though slender - victory for free trade. But in return for crucial support, House Republican leaders quietly agreed to weaken one of the Clinton administration's most-prized trade accords.
In a letter to Jim DeMint, a South Carolina Republican who switched his vote in the final seconds to give the White House a 215-to-214 win, three top Republican leaders promised to use "whatever means necessary" to cancel some textile export preferences Congress had granted Caribbean, Central American and Andean nations. In doing so, the lawmakers agreed to bolster textile manufacturers in Mr. DeMint's district.
Such protectionist side commitments are not uncommon when Congress considers trade agreements, and they are often defended as half-steps back to clear the way for a great leap toward open borders and expanded commerce. The concessions to Mr. DeMint helped reassure several other Republicans in textile districts who cast their votes to give President Bush trade promotion authority, a power the Bush administration says will allow the United States to join major global and regional free trade initiatives.
But perhaps because the margin in the House was so slim, the price of a victory this time was steep: critics say the proposals contained in the side letter - if agreed to by the Senate - effectively gut a central provision of the Caribbean Basin Trade Preference Act, a showpiece effort by the Clinton administration to help some of the world's poorest nations sell more textile and apparel products to the United States.
The promise may also complicate trade negotiations with the developing world.
Textiles are the most sensitive trade issue for poor nations because they depend on basic manufactured goods to provide jobs. Washington pledged to consider speeding the elimination of barriers to textile trade as part of negotiations begun in Doha, Qatar, last month. And the United States has come under pressure to grapple with its textile lobby as part of negotiations to free trade across the Americas.
The Bush administration is also being pressed by Pakistan to loosen quotas and reduce tariffs on imports of textile and apparel from that country, a concession to a partner in the war against terrorism that may become more difficult to finesse after the Republican horse-trading.
"This will definitely send a signal to the developing world as the U.S. tries to go forward with negotiations," said Lael Brainard, a former Clinton administration adviser on international economic issues who helped arrange a compromise on textiles that made possible the Caribbean trade accord last year. "These were very striking concessions to make, especially to members of the president's own party."
Charles B. Rangel of New York, the ranking Democrat on the House Ways and Means Committee and an opponent of the bill that gave new trade power to Mr. Bush, said his opposition turned to outrage when he learned of the arrangements to bring Republicans on board.
"This letter is a betrayal of all the reasons we have trade," said Mr. Rangel, a sponsor of the Caribbean deal. "It comes at the expense of hundreds of thousands of Caribbean workers as well as their governments who trusted that when the United States gives its word in trade matters, that word means something."
Robert B. Zoellick, the United State trade representative, called the DeMint concession "necessary to achieve a large good." He said the value of having the broader trade powers greatly outweighed the cost of backtracking on textiles.
He also blamed Democrats for opposing the new trade powers in overwhelming numbers and then condemning Republicans for making the deals necessary to get the package through the House, where Republicans hold a slight majority.
"If we had a few more Democrats voting with us, we could have avoided this compromise," he said.
House Speaker J. Dennis Hastert; Dick Armey, the majority leader; and Tom DeLay, the majority whip, made the promise to Mr. DeMint after the time for voting on trade promotion authority had expired. Opponents outnumbered supporters in the electronic tally by several votes. With Democrats shouting to end the voting and declare defeat, Mr. DeMint and the House leaders engaged in animated discussions on the floor before Mr. DeMint got his letter. Mr. DeMint, who had voted no, then switched his vote to yes.
In the letter, Mr. Hastert assured Mr. DeMint that no new trade bills would pass the House until Congress had taken action to make sure that any apparel assembled in the Caribbean or Andean areas for export to the United States is made from fabric that is dyed, printed or finished here.
Though the preferences have been in dispute for months, the Customs Service had ruled that Congress authorized Caribbean nations to dye, print and finish their own fabric and export final products to the United States free of duties and quotas as long as they purchased raw fabric from American producers.
Mr. DeMint fought to make the Caribbean nations buy higher-value-added fabrics before turning them into clothing for export. North and South Carolina are leaders in dyeing, finishing and printing.
He was not alone. Senator Jesse A. Helms of North Carolina also fought the preferences. He held up the nomination of Kenneth Dam, the deputy Treasury secretary, and several other top Treasury officials this spring to press the administration to overturn the preferences. He eventually allowed those nominations to proceed without forcing Bush administration officials to cooperate.
Administration officials refused to budge on the matter before Thursday's vote. Mr. DeMint met President Bush at the White House on Wednesday to discuss the terms of his support for the broader trade bill, an aide said. He consulted numerous times with Mr. Zoellick. But the letter agreeing to his terms was presented only after it became clear that trade promotion authority would fail without him on board.
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