Quick Action Sought On US-Mexico Trade Pact

WHEN President Bush meets Mexico's President Carlos Salinas de Gortari on Sunday, Mr. Bush will enthusiastically promote the planned North American Free Trade Agreement. Bush hails it as a major foreign policy priority that meets pro-growth domestic needs: increased export markets for United States producers who will create more jobs in order to fill bigger orders. While Bush stresses that a speedy and successful US-Mexico trade deal is germane to the ultimate hemisphere-wide pact, he is mindful of challenges he must first address at home. When Congress returns from Easter recess next Tuesday, it will begin haggling with the White House over the US approach toward the trade talks.

The administration is eager to put negotiations with Mexico on a ``fast track'' - to secure authority to work out its own trade deal with the Mexicans and then present it to Congress for approval, free of any amendments. Administration officials say an unimpeded track is essential to build the framework for free trade from Alaska to Argentina.

``The ``fast track'' is simply a procedure that enables the president to negotiate a trade agreement and, at the end of his negotiation, reach across the table, shake hands with his trading partner and say `This is the deal I will present to Congress,''' US Trade Representative (USTR) Carla Hills explained Wednesday. ``When we bring home a trade agreement, all of the Congress is involved.... They have a period of time to vote it up or down, not amend it.''

Senate Commerce Committee chairman Ernest Hollings (D) of South Carolina rejects the ``fast track'' as a White House maneuver to ``give away trade'' while the manufacturing base and other key sectors of the US economy lose their edge. Max Baucus, chairman of the Senate Finance Committee's subcommittee on trade, questions whether an agreement will be in US economic interests and not ``simply disguised foreign aid for Mexico.''

Advocates of a ``go slow'' approach are worried their concerns will be swept off the negotiating table by the ``fast track.'' What Ambassador Hills calls congressional ``special interests'' her opponents on Capitol Hill view as compromises on US competitiveness and standards: Mexico's dramatically lower wage scales, its relatively poor labor conditions, and its lax approach toward environmental regulations on industry.

The AFL-CIO is a vocal opponent of unrestricted trade with Mexico. Low-payed Mexican workers jeopardize US jobs, argue union officials. Mexico's labor force lures US businesses south of the border, where they are unencumbered by laws that require them to provide health benefits and other forms of workers' compensation.

If free trade leads to heightened capital investments abroad, say union officials, it will rob the US of important economic growth - and jobs.

Environmental groups see the impending trade deal as a way for US industry to circumvent strict Environmental Protection Agency laws by operating in Mexico. Fast and concentrated development in Mexico's urbanized areas will exacerbate its pollution problems, says a spokesman for the National Wildlife Federation, especially given Mexico's poor implementation of environmental standards.

Hills dismisses these allegations. She insists that Mexican economic growth - and all its benefits, including increased workers' rights and more attention to the environment - will be natural byproducts of freer trade with the US. And opening markets to US goods, she says, ``is absolutely vital to American prosperity. US exports to Mexico more than doubled over the past four years, from $12 billion to $28 billion, due to Mexico's decision to slash tariffs from 100 percent to 20 percent, says Hills. If M exico liberalizes further, she says, US ``exports will soar and ... we will generate new jobs.''

Christopher Whalen, a Washington-based trade consultant, contends: ``Increased US exports to Mexico means we're bleeding them dry. We're pretending Mexico's economy is healthy and well-managed. In fact, it's unstable - it's undergoing a foreign currency crisis and the government is $100 billion-plus in debt, much of it to US banks.'' He is among many who believe that the Bush administration is simply trying to prop up the Salinas government, the first Mexican leadership in years with a favorable view to ward Washington. ``There are other, less-damaging ways to help Salinas,'' says Mr. Whalen, ``like debt forgiveness.''

Robert Morris, senior vice president of the US Council for International Business, a group representing American big business abroad, says, ``US business has a great interest in a more open, more liberal Mexican economy - whatever government is in power. We're looking for export opportunities. There is a real prospect of $1 billion a year in additional auto sales, for example.'' The Council urges the USTR and the EPA to factor in environmental concerns in trade policy.

The USTR, who once vowed ``to pry open with a crowbar'' the tough-to-penetrate Japanese market, is apparently equally intent on securing an agreement with Mexico, on the administration's timetable, and not on Congress's. She warns that if the ``fast track'' authority is denied, the US will be paralyzed in its efforts to negotiate deals, both bilaterally and multilaterally.

Trade watchers contest Hills's assertion that failure to win ``fast track'' authority will shut off US-Mexico talks. ``Mexico needs us a lot more than we need Mexico,'' says Whalen. ``And we certainly don't need ``fast track'' to keep them in the game. Where else are they going to go?''

If a Senate or House majority opposes the fast track, the administration must recognize the right of the congressional opposition to attach conditions to an eventual trade agreement.