- The Washington Times - Thursday, February 15, 2001

Business leaders, hoping to grease the way for a long-stalled trade bill, are softening their opposition to including labor and environmental rules in international trade agreements, a move that has drawn the ire of leading Republicans.

The surprise overture to labor and environmental groups was announced last week by the Business Roundtable, a group of CEOs of major U.S. corporations that has become the most influential business voice in trade policy.

"The Business Roundtable believes these are important international issues, and that the issue is no longer whether they should be addressed in international trade and investment negotiations, but rather how to address them constructively," the group wrote in a report released last week.

In addition, the National Association of Manufacturers has tried to start a dialogue with unions and green groups. The U.S. Chamber of Commerce, by contrast, has shown little inclination to compromise.

The CEOs fear that the United States, where lawmakers remain sharply divided over the merits of free trade, is losing ground to other countries that are negotiating new free-trade pacts regularly.

The shift left many Republicans fuming that business is handing Democrats an advantage just as a closely divided Congress begins considering legislation that would grant the president the power to negotiate new free-trade agreements.

Rep. Jim Kolbe, Arizona Republican, said business groups should await the Bush administration's proposal for trade-negotiating authority before they give a nod in the Democrats' direction.

"They should not be giving something away before we even know where the train is headed," Mr. Kolbe said.

Senior staffers from the House Republican leadership, as well as Rules Committee Chairman David Dreier of California, have also complained to business lobbyists about the Roundtable's move.

One member warned that, by tilting in the Democrats' direction, lobbyists were "misreading the results of an election" that gave Republicans control of both houses of Congress and the executive branch.

Since Congress approved the North American Free Trade Agreement in 1993, the United States has negotiated only one additional pact, last year, with tiny Jordan.

By contrast, the European Union, Canada and much of South America have pushed forward with their own agreements. As a result of a Canada-Chile free-trade arrangement, Canadian firms escape paying Chile's 11 percent across-the-board tariff, an advantage their American counterparts do not enjoy.

The United States will have a chance to reassert its leadership when leaders from North and South America meet in Quebec City in April to decide whether to push forward with negotiations on a Free Trade Area of the Americas.

Business groups would like to see Congress pass "fast-track" negotiating authority this year to further this goal. Fast-track allows the president to cut trade deals and then submit them to an up-or-down vote in Congress, without any amendments.

A bitter dispute between Republicans and Democrats over whether labor and environmental issues belong in the fast-track legislation prevented its passage in 1997.

The CEOs that make up the Business Roundtable concluded that prolonging this quagmire is not worth the cost of lost trade liberalization.

"If we weren't stepping in here, the Republicans and Democrats would be digging trenches right now," one lobbyist said. "We're focused on the fact that we're being left behind."

Echoing this view, the Emergency Committee for American Trade has called for "new thinking and visible leadership" to resolve the current impasse, perhaps through high-profile initiatives outside trade agreements.

Republicans are willing to give a Republican president more leeway to negotiate on labor and environment issues than they would have given the Clinton administration, Mr. Kolbe said. But going too far in a direction Democrats would prefer will inevitably alienate Republican members.

"Trade deals always carry a heavy load," Mr. Kolbe said. "They don't need any more baggage."

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