May 25, 1999, Tuesday, FIRST EDITION
SECTION: MONEY; Pg. 3B
LENGTH: 742 words
HEADLINE: Daley's road trip hits potholes U.S. tour hopes to give trade a good name
BYLINE: James Cox
DATELINE: RACINE, Wis.
BODY:
RACINE, Wis. -- On the road to talk up trade, Commerce Secretary William Daley turns the tables on his questioners.
"Why," he asks a group of tractor-parts suppliers, "do you think there's such a negative feeling in your communities about trade?"
Daley is point man for President Clinton's drive to forge a "national consensus" on trade. At times, it must seem like a fool's errand. Eight years of economic growth, steadily declining unemployment and rising stock prices have done little to soften public mistrust of trade liberalization.
Monday, Daley's National Trade Education Tour took him to Chicago, Racine and Milwaukee, where he met executives, workers and students and groped for common ground on a subject that stirs fear and loathing in much of the country.
"Sixty percent of the American people fear trade is bad for their jobs," Daley says. "That's a heavy number."
More than a third of the country's growth since 1993 has come from increased exports. In Illinois, one in four manufacturing jobs and about 12% of all jobs depend on exports. By most measures, trade-related jobs everywhere pay more.
Too few Americans know that, Daley says. And too many think imports are bad. At the same time, business hasn't done enough to spread the free-trade gospel or dispel workers' fears, he says.
"I don't think they've viewed it as their job to sell trade," he says. "Workers whose jobs depend on it don't get the connection. They don't understand it."
The administration's frustration with the issue is growing. Polls show a majority of Americans disapprove of the North American Free Trade Agreement (NAFTA), signed five years ago with Mexico and Canada. Meanwhile, Congress has rebuffed Clinton's requests for presidential authority to sign new trade pacts. The administration faces a bruising battle to win congressional backing for its plan to get China into the World Trade Organization.
Daley's travels Monday signaled the job will be difficult.
At the Chicago Mercantile Exchange, a union official squared off against a Nobel laureate in economics.
NAFTA and other agreements have been used to "beat down workers, beat down their wages and make them insecure about their jobs. Trade is being used to hurt them," says AFL-CIO official Thea Lee.
Nonsense, says University of Chicago economist Merton Miller. Trade has made U.S. companies more competitive, and imports have benefited American consumers by holding inflation down.
"Trade negotiations are not a zero-sum game. It just seems that way. We don't keep score the right way. We don't ask how these negotiations will benefit consumers," Miller said.
Later, at Chicago's Lane Technical High School, a panel of CEOs joined Daley to talk about the wonders of China's market and the high-paying, trade-related jobs that could await them upon graduation.
The students showed interest in the USA's record trade deficit, on pace to hit $ 222 billion this year, and in labor standards in developing countries accused of using child labor. But the CEOs, tossing around terms such as "economic leverage" and "generalized system of preferences," confused some in their audience.
"I really don't have a full concept of trade. I'm still learning. I wonder what different countries think we're doing wrong and why China is closed," says Mauriceka Peavy, 17, a Lane Tech senior.
Members of the virulently anti-trade Teamsters union shadowed the Commerce chief all day. They staged noisy outdoor demonstrations during his appearances at the Chicago Mercantile Exchange and a Milwaukee engineering school. A Teamsters van cruised alongside Daley's bus as it traveled 65 miles from Chicago to the Case tractor plant in Racine.
Case's 18,000 workers are nervous because their company is being bought by New Holland, a Dutch heavy-equipment maker controlled by Italy's Fiat. The firms expect to save up to $ 500 million a year by combining research operations and streamlining sourcing for parts. As for layoffs, "there's always that possibility," says Steve Lamb, Case president.
The Teamsters ridiculed Daley's campaign as the "National Trade Propaganda Tour." Signs on the van read: "Free Trade Fat Cats on Board" and "Trust Us, We're Rich."
"I don't kid myself that it's going to be accomplished during this tour," Daley said as the Teamsters rolled by. "It's a tough sell."
GRAPHIC: On tour: William Daley gets into a Magnum tractor during a tour of the Case tractor factory in Racine, Wis., on Monday.