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Gramm Declares Support for World Trade Agreement

By James Risen and Paul Richter
Los Angeles Times

With critical congressional votes looming, the world trade agreement won another key ally Monday, when Sen. Phil Gramm, R-Texas, declared his support for the pact, which would reduce tariffs and other barriers to trade among 124 nations.

As the agreement heads for a ratification vote in the House Tuesday and the Senate Thursday, Gramm told reporters that he will join Senate Minority Leader Bob Dole, R-Kan., in supporting the pact on all votes in the Senate.

Gramm, a leader among conservative Senate Republicans and a likely presidential candidate, said he decided to support the accord - which would create a new World Trade Organization to succeed the General Agreement on Tariffs and Trade as the regime that governs global trade - despite what he sees as dangerous and extraneous provisions in the ratification bill.

Gramm's support was hailed by the White House and other proponents of the pact as critical to shoring up support among Senate Republicans during this week's lame-duck legislative session. Gramm's decision was especially significant because he said he would vote yes on the most critical issue - a waiver of the Senate's budget rules, which requires 60 votes.

Some advocates of the trade pact had feared that Gramm might declare his support for the agreement but vote against the the budget waiver. And they feared that other conservative senators might follow that lead. The budget waiver is necessary because the trade agreement calls for deep reductions in import tariffs - potentially reducing federal revenues by $30 billion to $40 billion over 10 years. Despite that, the Clinton administration has not proposed offsetting tax and revenue increases to finance those cuts, meaning that the budget deficit would be allowed to grow in violation of the current budget rules.

One administration official, told that Gramm had pledged to vote for the waiver, predicted the move "would send a very strong signal" to other undecided members of Congress. Others added, however, that proponents of the trade agreement were close to having the needed 60 votes in the Senate even before Dole and Gramm announced their support. Dole gave his endorsement in a White house ceremony last Wednesday.

Administration officials said they believe they will easily achieve the 218 votes needed for passage in the House. Most observers had said that the Senate would provide the toughest test for the trade agreement because of the budget waiver rule. And as President Clinton began phoning senators Monday afternoon to line up their support, some administration officials remained worried that, under pressure from opponents, some senators might try to delay the vote until next year. Such a move, they argued, could kill the agreement.

"We can't take anything for granted," said one administration aide.

Meanwhile, a bipartisan array of Washington notables from previous administrations crowded the East Room of the White House Monday to join Clinton in expressing their support for the agreement. Among them were James A. Baker III, secretary of state in the George Bush administration; James C. Miller III, director of the Office of Management and Budget under President Reagan; former Federal Reserve Board Chairman Paul N. Volcker; six members of the Clinton Cabinet and economists from both the private sector and government.

But the White House could not line up appearances from all the living former presidents, as it did last year before the vote for the North American Free Trade Agreement. Officials blamed logistic difficulties.

Three former presidents, Gerald R. Ford, Jimmy Carter, and George Bush, signed a joint letter of support that was read at the event. (White House officials said they did not want to bother Reagan, in light of his recent announcement he is suffering from the early stages of Alzheimer's disease.)

Baker, in an allusion to the dark predictions of Texas billionaire Ross Perot, said that during the debate over NAFTA, "the misguided and the misinformed predicted a vast sucking sound as American jobs went south." Instead, he said, the pact between the United States, Mexico and Canada had brought only the "powerful wind of economic freedom."

In his remarks, Clinton expanded on the same theme, asserting that since the North American agreement went into effect expanding U.S. auto exports to Mexico by 500 percent - auto workers' biggest complaint is excessive overtime.