President Reagan's decision to allow the law to demand 60 days' notice of factory closings and major layoffs is a victory for Democrats who forced him to face political reality and "get rid of the tar baby."

Reagan, who vetoed a huge trade reform package when it contained the same provision, continued to denounce the plant-closing measure even as he agreed he would let it become law after Wednesday night without trying to block it again."In order to end these political shenanigans and to get on with the business of the nation," he said Tuesday, "I have decided to allow the plant-closing bill to become law - but without my signature."

His protests notwithstanding, the president's action clearly acknowledged the political reality faced by his loyal vice president, George Bush, in the fall campaign for the White House against Massachusetts Gov. Michael Dukakis.

Dukakis had joined other Democrats in using the administration's opposition to the bill to strike a chord with many American workers and to pummel his Republican rival as more sensitive to big business than to common people.

Dukakis claimed victory Tuesday and maintained, "This bill isn't about politics. It's about fairness and decency and the way we treat people."

House Speaker Jim Wright, D-Texas, said he was "very pleased the president has seen the light" and added wryly, "When one denounces a bill and allows it to become law in the same breath and then speaks of political shenanigans, I wonder how he defines them."

Sen. John Danforth, R-Mo., spoke for many GOP colleagues in acknowledging the problems they faced in an election year.

"I think the issue has been a tar baby as far as the Republicans are concerned," Danforth said. "(The White House) finally reached a conclusion that this issue is not a winner and to get rid of the tar baby."

White House spokesman Marlin Fitzwater stood by the president's contention that the bill brings unwarranted government interference in private business and threatens many jobs. Democrats, he said, "have tried to distort it" and the "political realities have been laid out for everybody to see."

But Fitzwater said Reagan reached his decision after discussions with congressional leaders and Bush, who will claim the party's presidential nomination in New Orleans in two weeks.

Senate Republican leader Robert Dole of Kansas, who had advised Reagan to let the bill become law, acknowledged there was little chance of upholding a second veto and suggested the president opt for winning a final trade bill.

The plant-closing provision that originally was part of the trade bill will require businesses employing more than 100 workers to give 60 days of notice before laying off workers for more than six months. It requires similar notice in the case of plant closings if 50 or more workers at a site will lose jobs.

AFL-CIO President Lane Kirkland said Tuesday, "The overwhelming voice of the American people in favor of plant-closing notification has produced a victory for fairness."

Dukakis's running mate, Sen. Lloyd Bentsen of Texas, added that his party still will use the issue on the campaign trail.

"It is obvious that we (Democrats) did this," Bentsen said. "The administration's opinion is that a pink slip in the mail is enough."