Senate Panel Guts Airline-Competition Bill as Favor to American, TWA.

Byline: Philip Dine and Cynthia Wilson

Mar. 16--WASHINGTON--In a close vote Thursday, senators stripped an airline competition bill of all provisions that could pose problems for American Airlines' acquisition of St. Louis-based Trans World Airlines.

The Senate Commerce Committee did so after Sen. Jean Carnahan, D-Mo., said that if necessary she would fight the Aviation Competition Restoration Act on the Senate floor out of concern that it could threaten TWA's 20,000 jobs.

In related developments:

-- American Airlines' chairman will meet next week with political and civic leaders in Southern Illinois. They are worried that the merger will lead to a cut in commuter service from small cities to St. Louis. Thirty-six cities in 11 states are now served by TWA's regional carriers.

-- The Equal Employment …