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White House Barters for Trade Pact Votes

As Lawmakers Take Up Central American Measure, Bush Courts Undecideds With Deals

THE WALL STREET JOURNAL
July 25, 2005
By GREG HITT
As the House moves toward a vote this week on President Bush's Central American trade pact, the White House is trying to cut deals to shore up support.

An administration team scouring the House for votes has been showing more willingness to entertain lawmakers' requests for special breaks. One deal under consideration would protect shipments of U.S.-made denim to Nicaragua, a move that could secure the votes of perhaps half a dozen lawmakers from textile-producing areas in the Deep South.

"All politics is local, and I have to make sure the people at home feel their jobs are as secure as they can be," says Rep. Phil Gingrey, a Georgia Republican whose vote is tied to the Nicaraguan deal. Mr. Gingrey fears major Georgia employers, such as Mount Vernon Mills Inc. and Avondale Mills Inc., will lose business unless the protections are added to the Central American Free Trade Agreement, or Cafta. "The administration is trying to get it right," the congressman says, underscoring his leverage in the fight. "They're listening to us. They know our concerns. And, of course, they need our votes."

The bargaining spotlights the intensity of the fight for passage of Cafta. The deal would bind the U.S. economy to five countries in Central America, as well as the Dominican Republic, creating the second-largest U.S. trading bloc in Latin America, after Mexico.

The measure cleared the Senate on a 54-45 vote in June, after the administration cut a handful of side deals -- such as a pledge to New Mexico Democrat Jeff Bingaman to boost spending on labor-rights enforcement -- to help ease passage. But support lags significantly in the House, with informal counts suggesting it falls about 25 votes short of what is needed to ensure passage.

"Members of Congress simply will not associate their names and political futures with expansion of the Nafta trade model that most of the public views as a damaging failure," says Lori Wallach, director of Public Citizen's Global Trade Watch, one of several advocacy groups fighting Cafta. (Nafta is the North American Free Trade Agreement.) Members of the National Farmers Union blanketed Capitol Hill last week, arguing that small family farms will be hurt by Cafta. AIDS activists are speaking out against provisions that tighten control of generic medicines in Cafta countries. The Citizens Trade Campaign, a coalition of labor, environmental, farm and faith-based groups, is running radio ads in the districts of wavering lawmakers that raise doubts about the benefits of free trade.

On the other side, free-trade business groups are pushing for Cafta, and administration officials are combing a "whip list" of more than 50 lawmakers who say their minds aren't made up. "It's full speed ahead," says Commerce Secretary Carlos Gutierrez, who has met with some undecided members three or four times. He also has reached outside the Beltway, calling chief executives at pro-Cafta companies and giving interviews to newspapers and radio stations in key states, with the goal of rallying grass-roots support. Daily strategy is plotted on 7:45 a.m. conference calls that bring together officials from the White House, the office of the U.S. Trade Representative and the departments of Commerce, Treasury, State and Agriculture.

Rep. Bill Thomas, chairman of the House Ways and Means Committee, has made the most visible contribution in the vote-getting effort. The California Republican pledged to move legislation that would expose China to a new range of trade sanctions, and in return secured the support of Republican Rep. Phil English, a trade critic from Pennsylvania, and perhaps six to eight lawmakers for whom cracking down on China is the deciding issue. Among them is Rep. Todd Platts, a Pennsylvania Republican who says he is now "probably leaning yes."

Mr. Thomas also made a personal commitment to move any legislation that might be required to address concerns over fabric shipments to Nicaragua. Under Cafta, apparel made in Central America enters the U.S. duty-free if it is made with American yarn and fabric. One loophole in Cafta, however, allows Nicaragua to use some fabric from outside the region. Critics say the provision will allow low-cost Chinese fabric to be cut and sewn into garments destined for the U.S. "It didn't make any sense to give that away," says Roger Chastain, president of Mount Vernon Mills. Both Avondale, of Monroe, Ga., and Mount Vernon, of Mauldin, S.C., employ thousands of workers across the South. In Rep. Gingrey's district in northwest Georgia, Mount Vernon operates a plant with 1,800 workers.

A spokesman for Avondale didn't return calls to comment. Mr. Chastain says he doubts any of the textile deals on the table would ever be enforced. But U.S. Trade Representative Rob Portman says the administration is working in good faith "to give members some comfort."

Mr. Portman, a former House member, says momentum is building toward passage. But closing the final gap has been difficult. "It's tough," he says. "It's a trade vote, after all."

Write to Greg Hitt at greg.hitt@wsj.com


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