By Doug Palmer
WASHINGTON (Reuters) - U.S. lawmakers said they reached an agreement on legislation to boost President Bush's power to hammer out new trade agreements, setting the stage for the White House to regain the authority for the first time in eight years.
Senate Finance Committee Chairman Max Baucus, a Montana Democrat, and House Ways and Means Committee Chairman Bill Thomas, a California Republican, said late on Thursday they believed they had crafted a deal which could win approval in both the Senate and the House of Representatives.
The legislation is key to the Bush administration's ambitious trade agenda, which envisions new world trade pacts and a Western Hemisphere free trade agreement by 2005.
"This is very good legislation that helps American workers adversely affected by trade," Baucus said.
Senate Democrats have insisted any renewal of presidential trade negotiating authority be combined with increased federal aid for workers who lose their jobs because of rising imports or overseas factory relocations.
The agreement reflects 85 to 90 percent of the job retraining benefits and other "trade adjustment assistance" passed by the Senate, Baucus said.
Thomas said he expected the House to vote on the "trade promotion authority" bill before it adjourns on Friday for a monthlong recess. Baucus said the Senate would most likely take up the bill next week, before it leaves for its August break.
The White House has not had the negotiating authority -- also known as "fast track" trade legislation -- since 1994, mainly because of Democratic party concerns over the impact of trade agreements on workers and the environment.
Baucus and Thomas reached the agreement following a marathon negotiating session over three days.
The Bush administration has pressed for trade promotion authority since taking office 18 months ago.
The package includes a 65-percent tax credit to help workers displaced by changing trade conditions pay for health insurance. That split the difference between the 70-percent tax credit approved by the Senate and the 60-percent tax credit approved by the House.
Many Republicans have opposed the tax credit as opening the door to an expensive new government spending program.
The House-Senate deal also renews and expands trade preferences aimed at helping Colombia and other Andean nations of Latin America curb drug production.