AA STRIKE BLOCKED : CLINTON IMPOSES 60-DAY `COOL-OFF'.

Byline: Katie Fairbank Associated Press 

President Clinton blocked an American Airlines pilots strike this morning, ordering a 60-day ``cooling off'' period just minutes after union leaders ordered a walkout that would have shut down the nation's largest domestic airline.

Clinton took the action just after union President James Sovich ordered local strike leaders around the country to shut down the airline, a move that would have stranded up to 40,000 travelers.

Bruce Lindsey, the president's liaison on the talks, said Clinton was acting under the Railroad Labor Act designed to protect the economy against labor strikes. Negotiations will continue during the cooling off period, but the strike won't be allowed.

In addition to stranding passengers, an administration study said the strike would cost up to $100 million a day and force layoffs of 90,000 airline workers.

Cities with major American operations include Dallas-Fort Worth - the company's headquarters - New York, Chicago, Miami and Nashville, Tenn.

While the pilots continue to fly, a Presidential Emergency Board appointed by Clinton will take 30 days to propose a settlement. The parties would get another 30 days to resolve the dispute. If that doesn't work, Congress could impose a settlement.

Politicians from cities with major American operations joined the airline to urge Clinton's risky 11th-hour involvement; the union had told him to stay out of the fracas.

The White House announced Clinton's decision at 12:07 a.m. EST, after four days of marathon talks produced few results. Sovich had ordered the strike only four minutes earlier. Clinton formally signed the order and appointed the three-member emergency board.

Pilots want raises totaling 11 percent through 2000 and increased stock options. The company has offered 6 percent and smaller stock options. Another sticking point is who would fly smaller jets on commuter routes.

The union wants its members to fly the shorter routes and offered lower pay scales for those flights if the company accepted other demands. American's parent company, AMR Corp., said it wants its American Eagle subsidiary, with lower-paid pilots from another union, to continue flying the commuter routes.

The average American Airlines pilot makes $120,000 a year. The average American Eagle pilot makes about $35,000 a year.

A president has not acted under the railway labor law in an airline strike for more than three decades. Clinton did become involved in American's flight attendant strike in 1993 when he asked the airline to accept binding arbitration.

American had canceled most overseas flights to avoid stranding planes on foreign soil and begun canceling some domestic flights.

The airline's president, Donald Carty, said American would now try to fill empty seats by offering special sales and extra frequent flier miles.

Lindsey broke away from reporters about 11:45 p.m. EST  to take calls from the parties. He was told the union rejected the final offer, and immediately headed to the president's office in the White House residence to break the news.

``If you're going to act, the time to do it is now,'' Lindsey told Clinton.

The president quietly took the executive order and signed it.

Lindsey said the White House had determined that if Clinton acted, he would do it before the strike disrupted air service. ``We saw little benefit in people being disrupted,'' he said.

``There has not been a presidential emergency board in an aviation case for 30 years, but the fact of the matter is aviation has changed,'' Lindsey said. ``It is unregulated now, the airlines have gone to a hub system. And therefore the effect of a single carrier disruption . . . has a greater effect now that it would have 10, 15 years ago.''

Though aides said Clinton did not made a final decision until his meeting with Lindsey, the groundwork was laid earlier Friday for intervention.

White House spokesman Mike McCurry said the three members of the emergency board were recommended by the National Mediation Board, which regulates labor relations in the airline and railroad industry.

The three-member board will be chaired by Robert R. Harris of Maryland, a former chairman of the National Mediation Board who led a special board that resolved a national railroad dispute in 1991. That board was appointed by Congress.

Another member of the board, Helen M. Witt, also chaired the National Mediation Board. The third member is Anthony V. Sinicropi, an arbitration specialist and professor emeritus at the University of Iowa.

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Photo: (Color) Pilots and other employees picked American Airlines at Los Angeles International Airport Friday, before the strike deadline.

Myung J. Chun/Daily News