I had the same problem, minus the squeak. I don't know if your clutch setup is the same as my 1st gen, but right where the rod goes through the firewall on the pedal, there should be a lock nut and an adjusting nut. Try tightening that, which will extend the rod, giving you more throw. Your clutch isn't engaging fully, at least mine wasn't.

88 4R, 350 V8, R150 5 speed Sold <...uot; />
97 4R, stock, daily driver
98 Sienna, kid and dog hauler, wife's ride