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New report: Clinton, McCain, Obama - can we go a little deeper?

As long promised, we published a report today that Mary Bottari and I wrote that looks in detail at the Clinton, McCain and Obama plans on health care and climate issues. Our focus is on what changes need to be made to the WTO, NAFTA, and other trade pacts to allow for needed policy space in this area. Here's the press release for the report:

To Implement Domestic Campaign Policy Priorities on Health Care and Global Warming, Future Presidents Must Alter Existing U.S. Trade Commitments

New Public Citizen Report Identifies Changes to WTO, NAFTA Rules Needed to Facilitate Candidates’ Proposals on Health and Climate

WASHINGTON, D.C. – Public Citizen today identified changes needed to World Trade Organization (WTO) rules and the investment provisions of the North American Free Trade Agreement (NAFTA) to implement a dozen of the presidential candidates’ key health and climate policy proposals.

The changes were detailed in a report, “Presidential Candidates’ Key Proposals on Health Care and Climate Will Require WTO Modifications, Overreach of WTO Highlighted by Potential Conflicts with Candidates’ Non-Trade Proposals,” released today, available at http://www.citizen.org/documents/PresidentialWTOreport.pdf

“Growing public ire about our current trade and globalization policies’ damage to Americans’ economic prospects has played an enormously important role in this election, with most candidates committing to reform NAFTA,” said Lori Wallach, director of Public Citizen’s Global Trade Watch division. “But candidates and voters have little idea that some of the candidates’ domestic policy priorities on health care and climate change could be limited by the overreach of so-called trade agreements like the World Trade Organization. The need for a comprehensive overhaul of the WTO could not be more urgent.”

Although they have nothing to do with trade, key health care cost containment proposals on the creation of health insurance risk pooling mechanisms, reduction of pharmaceutical prices and electronic medical record-keeping, a proposal to expand coverage by requiring large employers to provide health insurance and a proposal to establish tax credits for small employers as an incentive to provide health insurance fall within WTO jurisdiction. In addition, proposals that address climate policy, such as increasing CAFE (Corporate Average Fuel Efficiency) standards, banning incandescent light bulbs, establishing new regulation of coal-fired electric plants and establishing national renewable portfolio standards (RPS), green procurement proposals and green industry subsidies come under the jurisdiction of existing U.S. WTO commitments.

“Corporate lobbyists, previous U.S. presidents, and ‘free market’ think tanks worked hand-in-hand to lock in corporate privileges on health care, energy and other domestic policies and shield them from small ‘d’ democratic reforms of the kinds proposed by Clinton, McCain and Obama,” said Todd Tucker, research director for Public Citizen’s Global Trade Watch division and an author of the report. “Now is the moment presidential candidates must stand up for their important domestic platform priorities and commit to renegotiate the WTO and other flawed trade deals.”

Moreover, the candidates haven’t addressed the need to renegotiate other provisions in trade deals like the WTO, NAFTA and other NAFTA-style trade deals that severely limit future presidents’ policy space to enact legislation on non-trade issues.

“Trying to work within the tiny policy space permitted by existing WTO rules would result in the challenges surrounding America’s health care debacle and the global climate crisis being defined so narrowly as to ensure real redress is impossible,” said Wallach. “The candidates must reject corporate calls for watering down their proposals and instead emphasize opening up the much-needed policy space to provide real solutions to pressing domestic concerns.”

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The youth are getting restless

Progressive life in the U.S. can be rough. The two main political parties and many environmental and non-profit groups in the U.S. are not really structured to facilitate mass participation, university "activism" has turned towards the depoliticized navel gazing of much of "cultural studies", blogs are cool but limited and not immune from collective action problems plaguing other platforms for action, and the union movement has been generally on the decline for decades. How's a young person to tune in, turn on, and drop (metaphorical) bombz on the system?

United Students Against Sweatshops has filled an important void  in leadership development for young progressives. The coalition has offered many yoots their first exposure to labor and solidarity organizing, and perhaps and unfortunately their last exposure to open and honest debates about politics with a small p (as opposed to big P, as in Politico), as some of us in the early days of USAS grappled with. While the group has done pioneering work on overseas labor conditions (hence the name), it has also been at the forefront of making U.S. campuses more labor friendly, both by supporting cafeteria and TA unions, and changing attitudes of upper and middle class students.

It is vital that groups like USAS continue to flourish and grow, so that there are many many more people involved in moving our country forward. Anyone who wants to help with that vision is encouraged to turn out tonight for USAS' 10-Year Anniversary Celebration here in DC, or simply donate online to a worthy cause. You can do both or either here.

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Trade back-and-forth in OH

Disclosure: Global Trade Watch has no preference among the candidates.

Clinton and Obama's showing in last night's Democratic debate gave us a few more glimpses into the candidates' plans for redirecting our trade policy. The highlight of the debate was both candidates' commitment to renegotiate or threaten to opt out of NAFTA. Though neither would commit to pulling out of NAFTA in the six month time frame, this is still a dramatic statement that we have not seen from either of the candidates previously. For more background on their stances, check out David Sirota's primer from yesterday.

This news will come as a great big sigh of relief for many Americans who have seen their lifestyles turned upside-down by our misguided trade policies - including NAFTA and almost a dozen clones that we've seen materialize since.

The CNN Political Ticker notes the moment and Ohio Senator Sherrod Brown's reaction:

Both Hillary Clinton and Barack Obama were asked if, as president, they would opt out of NAFTA in six months. Both candidates said they supported restructuring NAFTA and would use the threat of opting out of the agreement as a negotiating tool.

"They said it exactly right," Brown told CNN. "I want trade and more of it. I want it under different rules."

Brown voiced loud opposition to NAFTA during his 2006 Senate campaign, in which he unseated GOP incumbent Mike DeWine.

"If we say we want a different NAFTA," Brown continued, "they will negotiate, always with the threat of opting out if they don't, and that's exactly the right position. And I was thrilled, because I have not heard either of them specifically say that and they answered the question directly."

MLIVE, a Michigan news service, says that their state sympathizes with "Ohio's special beef":

Until now trade generally has been a low-profile issue in the long Democratic campaign. But Ohio has a special beef with U.S. trade policy, which union activists and many Democrats blame for a steep manufacturing decline.

Only Michigan has suffered a greater loss of manufacturing jobs than the 265,000 (23.7 percent) Ohio over the past seven years, mostly as a result of corporate outsourcing and plant closings. It's the worst jobs loss in Ohio "since the end of the Great Depression," according to the American Manufacturing Trade Action Coalition, a manufacturers association.

"Trade is an issue here," said Amy Hanauer, executive director of Policy Matters Ohio, an issue think tank, "and NAFTA is a proxy for trade. ... It may hurt Hillary Clinton."

The political consequences were made abundantly clear two years ago when Democratic Rep. Sherrod Brown unseated Republican Sen. Mike DeWine handily, chiefly by denouncing U.S. trade policy.

The New York Times reported this morning from the famous Midwest stumping-ground:

“We’re sick and tired of the empty promises and the same old story line about Youngstown and the mills,” said Phil Kidd, 28, a blogger and community activist who has sold 10,000 T-shirts that shout “Defend Youngstown” over the image of a steelworker wielding a sledgehammer. “The problem is that this is a rubber-stamp Democratic area so they know it’s almost a guarantee they’re going to get our vote. We just have to hope that this time whoever wins won’t forget about us.”

Both Democratic candidates have promised to remember, kicking off their Ohio campaigns here with fiery populist speeches they hope will appeal to the 100,000 Democratic stalwarts who live up and down the Mahoning Valley, the cradle of the Ohio steel industry and a place that has been shedding union-wage manufacturing jobs for the last 30 years...

Mr. Obama has also honed his message to tap into the anger and despair heightened by growing unemployment and the foreclosures that have felled 79,000 homeowners in the state. In a speech at Youngstown State University, he told the crowd he would give generous tax breaks to the middle class, establish a $10 billion fund to help homeowners facing foreclosure and provide incentives to companies that invest in struggling cities.

“Everywhere I go — not just in Youngstown, but everywhere — you see people who have worked in a plant for 20 years, put their heart and soul into building profits for shareholders,” he said. “Suddenly, the rug’s pulled out from under them; the job’s shipped overseas. They don’t have health care. They don’t have a pension. They’re trying to compete with their teenage kids for a job paying seven bucks an hour at the local fast-food joint.”

If the after-work crowd at the Golden Dawn tavern is any guide, Mrs. Clinton still enjoys solid support from the men whose rough hands and plain-spoken ways put them in the coveted demographic that analysts say hold the key to winning Ohio next Tuesday.

Many of the men who were sitting at the bar and salting their goblets of beer had clearly absorbed Mrs. Clinton’s contention that her opponent is too inexperienced to be president.

From The Washington Post, an elaborate lie-detector scale:

You would not think so from the way they have been attacking each other, but Clinton and Obama are not all that far apart on NAFTA. They both believe in free trade, but they both contend that the United States has gotten a bad deal from the way NAFTA and other trade deals have been enforced. Both candidates have used quotes selectively to slam each other. Two Pinocchios apiece.

ONE PINOCCHIO: Some shading of the facts. TWO PINOCCHIOS: Significant omissions or exaggerations. THREE PINOCCHIOS: Significant factual errors. FOUR PINOCCHIOS: Real whoppers. THE GEPPETTO CHECK MARK: Statements and claims contain the truth, the whole truth and nothing but the truth.

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Is it all about whitey?

"White Men Hold Key for Democrats", blared the Wall Street Journal headline, in discussing the Obama and Clinton's camp supposed courting of the white male "blue collar" vote in Ohio. Speaking as a white person (okay, and someone who had a class in whiteness studies led by a Korean guy who studied lesbian Iron Maiden fans in Appalachia), we're not that used to having our race pointed out to us quite so openly. That's what makes my new favorite blog, Stuff White People Like, such a hoot. (It's so true! I do totally heart standing still at concerts! lol lol, etc.)

Clearly, though, white men are a demographic group that left the Dems first in the 1960s-1970s, and again following the Dems' support of NAFTA in 1993-94, as Ruy Teixeira and Joel Rogers aptly showed in their 2000 book. This is a group that cares a lot about trade policy and economic security, and appealing just to the "latte-drinking, Prius- driving, Birkenstock-wearing, trust fund babies" crowd is not likely to play that well in Ohio, as evidenced by the Machinists' president using that as an epithet against the supporters of one candidate.

But, c'mon people, it's not just about white people, as a new study released today from my buds John Schmitt and Ben Zipperer from the Center for Economic and Policy Research shows. Among its findings:

Today, only 15.7 percent of all black workers are union members or covered by a union contract at their workplace. Twenty-five years ago, that share was 31.7 percent. Part of the reason for the decline in unionization among African Americans is the decline in U.S. manufacturing. But even within manufacturing, unionization rates have been falling. On average, manufacturing workers are now no more likely to be in a union than workers in the rest of the economy.
The study, which analyzed data from the Census Bureau's Current Population Survey, found that the share of African Americans in manufacturing jobs fell from 23.9 percent in 1979 to 9.8 percent last year. From 1983 to 2007, unionization rates among African Americans dropped from 31.7 to 15.7 percent. Unionization rates also dropped among whites (from 22.2 to 13.5 percent) and Hispanics (24.2 to 10.8 percent) during the same period, but the declines were not as steep as those for African Americans.

So it may be more apt to say that "The Economy Holds the Key for Democrats," or indeed for anybody wanting to compete in states where manufacturing and unions matter.

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Labor standards do not equal rising living standards

To listen to some of the recent chatter in the presidential debate about trade policy, you would think that the only problem with NAFTA is that it didn't contain core international labor standards in the main body of the text. As we've pointed out, core labor standards are only the beginning of what needs to be fixed with the failed NAFTA model, and many labor unions think even the labor standards achieved in the Peru FTA - supported by all the top contenders for president - didn't take us to where we need to be on that issue alone.

But this debate even obscures a larger issue: that labor standards are not going to put food on anyone's plate. As our own Lori Wallach notes over at Huffington Post,

Strong labor standards are necessary, but they are not sufficient to alter trade agreements' damaging economic outcomes for Americans. Labor rights requirements in trade pacts will provide workers in trade partner countries with essential tools to organize for improved wages and conditions over many decades as part of creating a social contract that may take a century to establish, as it did in the United States. However, a future president has a duty to secure tangible gains for Americans who are losing their jobs and seeing their wages stagnate today, and who fear for their children's futures in the coming decades. That requires changing the status quo trade model by eliminating provisions that promote immediate offshoring of U.S. production and jobs. The foreign investor protections included in these agreements directly incentivize offshoring by removing the risks normally associated with relocating to low-wage developing countries.

Indeed, the *best* case scenario for labor rights in an FTA over the short-to-medium term is that there is a lawsuit brought by the U.S. government against a developing country for failure to comply with labor rights (subject to multiple and difficult to meet conditions). This could be awesome, no doubt about it, and would provoke an important debate. But lawsuits alone will not put food on the table in either the U.S. or Mexico.

How did we get into the position where labor rights became the outer horizon of the thinkable? For some insight on the question, I highly recommend this article by Robert Howse, "From Politics to Technocracy". Howse is probably more sympathetic to the overall GATT-WTO agenda that we here at EOT, which makes some of his insights all the more interesting. His read on history is that the basic trade policy infrastructure was drawn up in a time of Keynesian welfare states in developed countries, where "one simply assumed a certain toolbox of effective nontrade policy instruments, and the stability and viability of the social bargains within states as well, or at least the stability of institutions that construct and reconstruct such social bargains." In other words, many in the group assumed massive domestic redistributive interventions in the "free market" were just fine, while they should be limited in actions between governments internationally. All of this, it was thought, could be technocratically managed, if one were to restrict "politics" to the domestic sphere.

But the growth of neoliberalism in the 1970s and 1980s (which I would argue was fed by this very group of trade lawyers) decimated the ability/willingness of states to have effective domestic responses to economic problems.

Continue reading "Labor standards do not equal rising living standards" »

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Recap of candidates trying to distance themselves from NAFTA

We highlighted the press coverage around the Clinton-Obama NAFTA battles earlier this week. Just to dig a little deeper, here are the primary sources - what each campaign was saying.

From Clinton's campaign on Valentine's Day: Obama Campaign Continues Dishonest Attacks On Hillary and NAFTA - concluding with "Based on his positions in Illinois and the United States Senate, the National Journal concluded that Sen. Obama was 'the most likely presidential candidate to support further trade liberalization.'"

Clinton again, two days later: Newspapers Reported Obama's Support of NAFTA, Desire To Pursue Similar Agreements, citing the Decatur Herald & Review as saying "Obama said the United States benefits enormously from exports under the WTO and NAFTA."

Obama responded the same day with Clinton Camp Again Pushing Inaccurate Quotes on Obama and NAFTA That Were Debunked Months Ago. In this post, the campaign says "The Clinton campaign is trying to push old, inaccurate quotes that misstated Obama's position on NAFTA... Obama has consistently opposed NAFTA-like trade deals."

Finally, Clinton the next day: Obama Campaign Transcript Not Supported By Audio, retorting that "The transcript posted by the Obama campaign [in the above release] does not appear in the audio."

Whew. Standard disclosure: Global Trade Watch has no preference among the candidates.

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The Bourne Gamble

The WTO Antigua case on Internet gambling has highlighted many of the problems with our current trade policymaking process - the hazards of Fast Track-enabled trade agreements that undermine the public interest and ignore state and local officials, overreach and interfere with our domestic policy, and can trigger millions of dollars in compensation to other WTO countries. Now, the problems with the secrecy of this compensation and negotiation process have come to light.

According to a new CQ article (sorry, not linkable), the compensation agreed on between the US and EU, Canada, and Japan for withdrawing the gambling sector from our WTO commitments is classified for national security reasons.

Ed Brayton (a freelance writer who opposes the government’s anti-gambling measures) filed a Freedom of Information Act request with the Office of the U.S. Trade Representative after the deal was announced in December. He says he just wanted to know precisely how much the United States was conceding in the December deal to maintain its gambling ban. The agency’s chief FOIA officer, Carmen Suro-Bredie, replied that the USTR was withholding the agreement because it was “classified in the interest of national security.”

Although upon announcing the agreement, USTR said it involved "commitments to maintain our liberalized markets for warehousing services, technical testing services, research and development services and postal services relating to outbound international letters," they are apparently refusing to tell the public any further information. Instead of taking the opportunity to learn from the colossal mistake of committing gambling to the WTO and now include more state officials and the public in the process, the USTR is continuing to conduct US trade policy in a shroud of secrecy.

Hopefully, Brayton's persistence will pay off:

Brayton says he’s planning to appeal the denial, which would force the trade office to explain why the agreement implicates national security. He says he suspects the agency may have something else in mind: hiding what could amount to billions of dollars in trade concessions.

“I can’t even imagine a reasonable explanation other than that in the furthest reaches of my imagination,” he says.

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Green jobs, soft bigotries, big opportunities

Once in a rare while, an idea actually takes the nation by storm. It may not necessarily be a new idea, but it is articulated in a new and exciting way that captures the political imagination. Such an idea is the "green jobs" agenda, which attempts to conceive of a move to a green economy in a way that actually increases jobs and income, rather than taxing us back to preindustrial times. My new buddy Susan Helper described this set of ideas fairly concisely in a new paper for the Economic Policy Institute. Among the arguments she presents and summarizes:

  • A 2-3 degree Celsius increase in temperature could lead to mass species extinction and flooding; in order to avoid this and other consequences, carbon emissions (which lead to global warming) in developed countries must be reduced 80%. While this sounds very daunting, and indeed it is, there are relatively small investments that could be made in energy efficiency and renewable energy that can take us there. Thus the green jobs agenda.
  • At the same time, U.S. workers are hurting. Less than 10% of the workforce is currently in manufacturing, and key industries like the tooling industry are nowhere near where they need to be to move to a green economy. Thus, greening could potentially lead to more offshoring - not the nail in the coffin that the American worker needs after a generation of wage stagnation.
  • Despite that doom and gloom, manufacturing is still responsible for a majority of U.S. innovation, and U.S. manufacturing companies - especially when they empower their workers to self-manage - can have significant productivity advantages over more top-down competitors both domestic and international. They can also pay high wages.
  • Then, very helpfully, Sue shows how the "high-road" policies people like her and Dan Luria have been talking about for a long-time can and should dovetail with the green jobs agenda.

Sue's proposals have many good counterparts, and virtually every candidate and many many union and environmental groups are coming up with their own proposals.

But even an emergent discourse like green jobs can get hampered by inherited discourses, like that promoted by the boosters of our current NAFTA-WTO style trade policy. Former U.S. trade officials are arguing that we mustn't pursue any policies that are WTO-illegal, while even our good friends are feeling pressure to justify their policies in the lens of the WTO.

I don't know about you, but the first institution that pops in my head when I think of saving the planet is not the WORLD TRADE ORGANIZATION. I dunno, maybe it's because its judges have ruled against so many good environmental policies both here and abroad. By bending over backwards to claim WTO legality, I think we sell ourselves or the planet short on the discussion we need to be having about reinvigorating local democracy and economies.

Part of addressing the global warming crisis will involve immediate action to reduce some of the redundant trade that is taking place (where we ship the same heavy items back and forth across oceans), to correct global trade imbalances, and to empower policymakers and workers to take more control over their economic destiny. (This is what I think is what Sue is talking about in her proposals for everything from the shop floor to a national economic strategy.) I think the public is very ready to have this discussion, as can be seen from discussions of trade policy playing so prominently in the campaigns. I don't think we have to wait until 12 years to start addressing competitiveness issues either, as many of the proposals before Congress currently do. After all, much of the offshoring of U.S. production to Mexico and China happened in considerably shorter time periods.

In other words, we need to decide what is to be done, and then figure out how to overhaul the WTO to meet our targets, rather than starting from the unhelpful premise of ensuring WTO legality.

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What our former colonial masters think of our democracy

From an interview with European trade commissioner Peter Mandelson - formerly of New LabOUr, "new" because it's lite on the labOUr - with the Wall Street Journal:

Mr. Mandelson argues on a recent afternoon -- more so than any of the EU's 27 member states -- it is America that threatens the cause of free trade today.

"You can see it in the politics of the country," he says from his armchair in an EU office in the shadow of the Eiffel Tower. "You can see it in the Congress, you can see it in the primaries, you can see it in the town-hall meetings, you can see it in the candidates who, in order to appeal to the public, articulate these arguments" of protectionism...

"The caveat is that we're in the primary season," Mr. Mandelson observes. "That's not necessarily a position she would take into the general election, and if she did it's not necessarily one she would take into the White House if she won. But you can't ignore it.

"I've known the Clintons for over a decade, and I've always seen them as free traders. But most of the Democrat free traders seem to have taken to the hills," he laments. "I wish there was more pushback within the Democrat Party, because they know this is right, they know this is responsible, and for a long time now you've seen politicians on both sides of the aisle using trade as a wedge issue. And it's a very dangerous wedge to play with, because it's short-term, it's counterproductive, it leads you nowhere."

If there's a reason for optimism, Mr. Mandelson says, it's that "amongst the Democrat candidates, the person who's been questioning free trade most loudly and showing support for protectionism has been forced out of the race -- John Edwards. And the Republican candidate who is most strongly in favor of free trade seems to be leading the field at the moment -- John McCain."

Wow, nothing like a lecture on democracy from an unelected trade bureaucrat whose home country still has a queen to make a fair trader feel on the same side as the Clintons. In response to a previous similar intervention in our sovereign election, Rep. Barney Frank (D-Mass.) schools Petey Pete on Democracy:

European Union Trade Commissioner Peter Mandelson’s attack on Senator Hillary Clinton for her position on trade is a graphic example of why he will not succeed in his efforts to conclude a new world-wide trade treaty this year.

Senator Clinton has voiced the views of many of us, including I believe a substantial majority of Democrats and a significant number of Republicans as well, that trade should not go forward without measures that deal with the impact it has on income distribution and employment within countries. Mr. Mandelson’s dismissal of these sorts of concerns as ‘protectionist’ reinforces the view of many that the most ardent advocates of free trade treaties that ignore social and economic consequences cannot be trusted to make decisions about this important subject. It is particularly disappointing to me that Mr. Mandelson, who comes politically from the British Labor Party, would show such a lack of concern for the negative impacts that past trade treaties have had on many working people.

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Dem candidates battle it out over trade

Hillary and Obama are now preparing for several more important contests with the Wisconsin primary today, and Ohio and Texas close on its heels. These are among the states that have suffered most severely under our failed trade policies. The big question now? Who can bash "NAFTA" the most at each stop. Here are some of the high and low lights from the last few days.

Wall Street Journal in "Democrats' Attacks on Business Heat Up", from Saturday:

  • "People react very strongly against Nafta," said Anna Burger, head of SEIU's political program, in an interview. "We've seen job loss in this country as a result of Nafta. She's speaking out against Nafta now, but she has ties to it. That's been a high hurdle for her to overcome."
  • Sen. Sherrod Brown (D., Ohio), one undecided superdelegate, won election in 2006 with a populist message and said he is pleased that the presidential candidates are now following suit. "They were both a bit slow to get there, but they both have genuine beliefs about the middle class and working families and they're going exactly in the right direction," he said.
  • Hillary on the state of our nation's inequality: "We're going to end every single tax break that still exists in the federal tax code that gives one penny of your money to anybody who exports a job. Those days are done," she said. "It is wrong that an investment money manager in Wall Street making $50 million a year gets a lower tax rate than a teacher, a nurse, a truck driver, and autoworker making $50,000 a year."
  • Mr. Obama's language has the same ring ...denouncing Nafta for shipping jobs overseas and, he said, forcing "parents to compete with their teenagers to work for minimum wage at Wal-Mart." "That's why we need a president who will listen to Main Street, not just Wall Street, a president who will stand with workers not just when it's easy, but when it's hard," he said. ... "Decades of trade deals like Nafta and China have been signed with plenty of protections for corporations and their profits, but none for our environment or our workers who've seen factories shut their doors and millions of jobs disappear," he said.

From the L.A.Times:

Both also say they favor reworking the North American Free Trade Agreement.

Still, Obama's strategy is to try to make NAFTA a central issue of the campaign and to try to draw contrasts on the issue with Clinton.

Many union voters believe that NAFTA was responsible for encouraging companies to send U.S. jobs abroad.

"Hillary Clinton believed NAFTA was a 'boon' to our economy," said one flier that the Obama campaign mailed to Ohio voters last week. A bleak-looking, abandoned factory was pictured on the mailing.

"We are going to mention NAFTA on every occasion," said one top Obama advisor, who asked that his name not be used.

Obama's claim that Clinton called NAFTA a "boon" to the economy is based on a 2006 item in the New York newspaper Newsday.

In that item, Clinton did not use the word "boon." Rather, the newspaper used that word to characterize her position in a chart accompanying a news story.

Clinton and her influential labor and political allies in Ohio called reporters Friday to denounce the Obama brochure as including "false claims" about her record on NAFTA. Her staff cites evidence that she privately argued against NAFTA inside the Clinton White House in the early 1990s and that she consistently called for improvements in the trade deal since her arrival in the Senate.

Still, some perceive Clinton as being too supportive of NAFTA. David Caldwell, an official of the United Steelworkers of America in Ohio, said that "Barack Obama is a little vague on this issue. But the Clinton position has been clear, at least in the past. And it was clearly wrong."

From today's New York Times:

“Revolutions in communication and technology have made it easier for companies to send jobs wherever labor is cheapest, and that’s something that cannot be reversed,” Mr. Obama said. “So I’m not going to stand here and say that we can stop every job from going overseas. I don’t believe that we can — or should — stop free trade.”

Mrs. Clinton has been critical in her presidential campaign of the way Nafta was carried out, and she has called for an overhaul of the program that helps workers who lose their jobs due to trade and for an end to any tax incentives for companies that move jobs abroad.

At an event Monday at a union hall in Wausau, Mrs. Clinton said that other countries had taken advantage of the Bush administration’s pro-trade policies.

“I’m tired of being played for a patsy,” Mrs. Clinton said at the hall. “We have the largest market in the world. It’s time we said to the rest of the world, ‘If you want to have anything to do with our market, you have to play by our rules.’ ”...

“We now have greater income inequality than any time since the Great Depression,” Mr. Obama said, speaking to reporters after touring the titanium plant. “For us to want to reverse that so everyone has a stake in the economy, I think is just common sense and good for everybody, including business.”

And there has been non-stop coverage from John Nichols in the Capital Times (WI):

  • Here with Ted Kennedy: "NAFTA was a prime example (of an unwise approach to trade for the U.S.) and President (Bill) Clinton was the key spokesperson for NAFTA, and it was supported by Senator Clinton," explained Kennedy. "Up until a little over a year ago, she was heralding that posture and position. So I think it's valuable and useful for people that are concerned about this issue that they have a healthy understanding of what the background is." The background, Kennedy suggests, highlights the stronger position of the man he is supporting for the Democratic nomination for president. Illinois Senator Barack Obama gets it. "Barack Obama understands that trade is a key element in the development of industrial policy," explained Kennedy, in response to questions from The Capital Times. "And (he knows that) the adverse trade policies of this administration, which has moved job overseas because of tax incentives and a failure for implementation of various trade agreements and weaker trade agreements, have put at risk our whole industrial base (causing) the loss of hundreds of thousands of jobs."
  • And here with Hillary: "I have been somewhat surprised by the intensity of his attack. I was not in the Senate and neither was he when NAFTA was voted on. And he's made this a centerpiece of his campaign here and is attempting to do so in Ohio," Clinton said. "I have been a critic of NAFTA. It did not fulfill its expectations and caused a lot of consequences that we're going to have to deal with. And I have clearly stated for a number of years that we need to have the kind of pro-American smart trade that comes from looking at the trade agreements we've already passed, evaluating them and revising them so that they're more in keeping with the what the standards are that we expect. I've said we would have a timeout when I become president to look at every single trade agreement and figure out how we're going to make them fulfill the expectation of strong labor and environmental standards. I've been advocating for a trade prosecutor, which would be the person in our government to vigorously enforce trade deals ndsh because one of the problems is that the United States actually lives by most of our trade agreements and a lot of our trading partners do not."

And anonymous Dem operatives are criticizing Obama's Patriot Employer Act over at the the FT. Wonder who it could be??

Disclosure: Global Trade Watch has no preference among the candidates.

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How corporate lobbyists got-r-done

It's our unfortunate duty here at EOT to have to read some truly mind-numbing trade law analyses of domestic regulation. For instance, have you ever really thought about whether electricity is a good or a service? Yesterday, I had to read through a 1998 WTO document that goes through this metaphysical question in excruciating detail. Short answer: if your electricity comes from coal, well then the coal itself is a good. But once it becomes electricity, it's probably a service, because you can't plop a piece of electricity down on your dinner plate.

Since the Bush I and Clinton I administrations committed many energy-related services to the restrictive WTO service sector agreements, there's a good chance that many of Clinton, McCain and Obama's proposals on energy could run afoul of WTO rules. So if the political reasons to talk fair trade weren't compelling enough, there's plenty of good policy reasons as well.

You may ask yourself, how did we get to the point where lawyers sat around thinking of basic human rights to turn into "tradeable commodities/services"? To paraphrase Larry the Cable Guy, this 1992 intellectual history article by William Drake and Kalypso Nicolaidis shows how corporate lobbyists "got-r-done":

The very act of defining services transactions as ‘trade’ established normative presumptions that ‘free’ trade was the yardstick for good policy against which regulations, redefined as nontariff barriers (NTBs), should be measured and justified only exceptionally. Members believing there to be many justifiable exceptions thus had to defend what their counterparts label ‘protectionism.’… [the services trade lobby’s] body of work took on the attributes of a social science literature in which authors cited, critiqued, and built on each other's analyses. But unlike most academic debates, in which contending theories and assumptions remain contested, the services discussion produced broad and lasting consensus on core concepts and objectives. Community members were by now unanimous in their dedication to the common policy project of placing services on the GATT agenda, and this relevance test precluded meta-theoretical differences of the sort familiar to political scientists. Disagreements were confined to the issue of which GATT principles and processes were right for which transactions, rather than to the question of whether services should be treated as trade in the first place.

This gets back to my point about how savvy corporate interests are at incrementalism. You don't have to totally commoditize everything in a single day or single WTO round: just getting some definitions on the table can get the corporate animal spirits spirited up. Before you know it, public interest advocates are on the defensive, having to articulate why they thought regulation was necessary in the first place. And unfortunately, even many of our best politicians attempt to strike a "middle ground" between the previously unthinkable corporate takeover and the public interest, leading to a continual rightward drift.

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Globalization of Higher Education

Fascinating article in the Sunday New York Times, kicking off a series on globalization and higher education.  Did you know, for instance, in Doha, Qatar, you can get a Cornell, Georgetown, Carnegie Mellon, Virginia Commonwealth, or Texas A&M degree? 

American universities even public higher education institutions are trying to create a global brand for themselves, despite the difficulties of meeting local requirements and transitioning faculty and staff, in the hopes of attracting new funding opportunities and more students globally. 

There are plenty of downsides and upsides to mull over when we're talking about public and private American institutions establishing comprehensive higher education campuses in far flung locales, but one thing is clear.  As universities from the United States, Australia, England and other countries seek to market their global brand, higher education will increasingly be approached as a profit-making business instead of as a public good.  This is particularly worrisome when we consider that higher education is one of the "service sectors" that the United States is considering offering under WTO GATS jurisdiction

Given the perils of permanently binding important, regulated services to WTO rules, offering higher education would be a mistake if not so obviously now, then certainly in the future.  The lines between "public" and "private" are blurry in higher education, and locking our education policies to a set of trade rules would unnecessarily constrain our policy space and further undermine public education down the road.
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Global justice on the move, with global ambulance chasers right behind

I am pretty jazzed from a great weekend spent with the Citizens Trade Campaign, whose far-flung organizers from around the US came to town this past weekend for a national meet-up. These coalitions - from Oregon to Maine, from Texas to Minnesota and all parts in between - are truly the front-line for the campaign to overhaul our trade policies to align them with the public interest. There was a lot of fascinating presentations on the trade-linkage to immigration, climate change, labor, and higher education issues, which I think will be fueling a lot of interesting work in the year ahead. Indeed, the resolutions and other policies that this group will be pushing - especially at the state level - are part of those educational building blocks that will help us move towards our goals over the coming decades, which is what it will take to fundamentally change the way we approach global warming policy.

Incrementalism is also a feature of the other side's approach to the issue. As ITN documents in their latest issue, corporate interests have made some calculated gambles on a series of investment cases which - even if they don't produce an immediate win - chip away at the public interest by building very pro-corporate case history.

The first was a NAFTA case brought by a Canadian corporate cattlemen group against the U.S. border shut down following the episodes of mad cow disease in Canada. This coalition maintained that this US action - even though they had no observable investment in the US - violated their investor rights in the US. The NAFTA panel ruled against jurisdiction on the claim, even though they have done nearly the opposite in the SD Myers case where there was little or no overseas investment. And they also left the door open to challenge of the US food safety measure under other parts of the NAFTA agreement. So, lost the battle, but well positioned for the war. (Note that these precedents aren't binding on future panels, so unpredictability reigns!) 

The second item of interest is the advice being given to Internet gambling companies that are dismayed that the Bush administration bowed to pressure and removed gambling services from WTO jurisdiction. The global "ambulance chasers" - out to help corporations claim victimization and bilk all sorts of payments out of the corporate handout that is our "trade" policy - are advocating that these companies use bilateral trade and investment agreements to get compensation for not being able to serve U.S. gambling addicts their online fix. This is precisely the kind of corporate checkmate that our "trade policy" allows - first we get you at the WTO, then under CAFTA, then we let investors privately get you under other treaties, etc. - all the while getting payments from taxpayers. When are we going to see some elected officials willing to face down these jerks and kick over the chess table?

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Trade popping up in congressional races... and it's only February!

The Daily American's (Penn.) "Teacher to challenge Shuster for Congress" talks about Democat Tony Barr who is challenging Rep. Bill Shuster (R-Pa.) this year on a fair trade platform:

As a congressmen, Barr would push to re-write free trade bills.

“What they are doing is sending jobs out of the country,” he said. “We can’t do that anymore.”

He said the North American Free Trade Agreement, or NAFTA, hits the United States especially hard because it also hurts the Mexican economy.

“Mexican farm workers are leaving Mexico and coming across the border, in many cases illegally,” he said. “That hurts us here and drives down wages, so we are being hit twice. If we are going to do anything with illegal immigration, we need to reduce free trade agreements and make sure they are fair trade agreements.”

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Afro-Colombians reiterate opposition to Colombia FTA

Marino Córdoba, founder of the Association of Internally Displaced Afro-Colombians (AFRODES), has a nice guest blog post at The Hill entitled "Why Afro-Colombians Oppose the Colombia FTA."  The whole post is worth a read, but the juicy tidbits include:

...At the end of 2007, angered by the strong opposition of the majority of Afro-Colombian communities to the U.S.-Colombia Free Trade Agreement (FTA,) Uribe created a new Commission in Colombia that directly challenges our legal governance structure.

Cynically dubbed the Commission for the Advancement of Afro-Colombian People, it would undermine our communities’ ability to advance development strategies chosen by our people that comport with our needs and that help even the economic playing field... President George Bush and other U.S. Uribe allies, such as Rep. Gregory Meeks (D-NY), and the vast array of lobbying firms hired by the Uribe government are now trying to tout this outrageous Commission as evidence that Afro- Colombian concerns are being addressed as they push to pass the FTA.

Córdoba says that thanks to a vibrant civil society movement in the 1980s, Afro-Colombians enjoy full legal recognition of their cultural rights and collective ownership of their lands (he specifically mentions Law 70 of 1993 (PDF), a rather remarkable piece of progressive legislation that I'd encourage anyone to read).  Yet this recognition has been undermined by paramilitary organizations forcing Afro-Colombians off of their land: "Tens of thousands of us have been forced to flee... clear[ing] the way for the entry of oil palm plantations, logging operations, and mining projects advanced by allies of the Uribe Administration."

The Colombia FTA's Chapter 10 contains the same poisonous investor rights provisions as NAFTA, CAFTA and the Peru FTA.  If the FTA is implemented, these provisions will only exacerbate the situation, empowering foreign companies to engage in resource extraction made possible by the illegal and often violent forcing of Afro-Colombians off of their land — land supposedly guaranteed to them by Law 70.

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The field narrows, and advice from Feingold

This just in... Romney to pull out... On trade, Romney started out his campaign by talking about how great offshoring was, only to end up in Michigan talking about fighting for manufacturing jobs. A strange thing, democracy - when it works, it ends up changing the positions of those in power.

Even Huckabee, who as governor of Arkansas signed his state up for the procurement chapters of NAFTA-style deals, channels some of our own Holly Shulman from earlier in the week:

When President Bush agreed with House Democrats on a stimulus package centered on big tax rebates, for example, Mr. Huckabee raised the hackles of supporters of free trade by arguing that the plan in effect subsidized the Chinese manufacturers of imported consumer goods. And he argued that the money would be better spent building roads, bridges and other infrastructure projects at home, irking proponents of limited government.

In the wake of Edwards losing the race, there are now new power centers pushing on Clinton and Obama to fair trade it up. As John Nichols writes:

"Talking about experience and idealism is so much conversation for Wisconsin people," says Feingold, a three-term U.S. senator who serves with Obama and Clinton and who flirted with making a presidential run of his own this year. "We'd like to hear something about what they're going to do. It's amazing to me that this campaign has gotten as far as it has without getting down to specifics. But Wisconsin voters expect more from the candidates than the slogans." Like what?

Feingold says that the two remaining serious contenders for the nomination need to bone up on trade policy -- and its impact of real people in places like Wisconsin.

"I would urge them to be aware of the devastation that has occurred for people in the state over the past twenty years as a result of trade policies that were forced through Congress without any concern for working people in states like Wisconsin," says Feingold, who has since coming to the Senate in 1993 consistently opposed the free-trade agenda of both the Bill Clinton and George W. Bush administrations.

The campaign — especially on the Dem side — could get pretty interesting as the candidates grasp at something — anything — to differentiate between the two. Feingold's suggestion seems pretty savvy to me.

(Disclosure: Global Trade Watch has no preference among the candidates.)

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Stimulating? Or, well, not so much?

As congressional leaders, the Bush administration and presidential candidates tout the stimulus plan (that probable $600 check you'll be getting in the mail to spend and thereby help the U.S. economy) they forgot one thing: nothing anyone buys here is made here. Thus, the plan may be well, less than stimulating.

Alan Tonnelson, U.S. Business and Industry Council, has much more on this in the Pittsburgh Post-Gazette. Some highlights:

  • "Consumer goods are the types of purchases likeliest to be made with rebate or other stimulus dollars that are spent (as opposed to saved). Yet in 2006 -- the last year for which detailed data exists -- more than 61 cents out of every dollar Americans spent on such goods was spent on imports. In 1997, that figure was about 38 cents."
  • "Failed trade policies deserve much of the blame. Starting with the North American Free Trade Agreement in 1993, too many recent U.S. trade deals have focused too tightly on helping multinational companies move jobs and production offshore, instead of opening foreign markets to U.S. made goods."
  • "Americans for now may have no choice but to accept that many of the stimulus plans' benefits will leak overseas, and that near-term economic performance will be modest at very best. But it's not too early to insist that U.S. leaders start recreating the foundations for solid, healthy growth -- and stop making policy as if the global economy and the trade-related mess they created didn't exist."

So when you do your stimulus check spending, think about all the things you can buy that are made in the U.S.! Or at least try to think of one thing you can buy that is still made in the U.S...

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Pre-Super Tuesday reflections

(Disclosure: Global Trade Watch has no preference among the candidates.)

A lot of folks are offering their reflections the relative merits of the candidates (see here, here, here, and here.) I was able to share mine at San Francisco's NPR station a little earlier today.

As I see it, we should evaluate trade policy on three overlapping dimensions:

  1. Who is affected
  2. How is it made
  3. What are the "surprise" implications for non-trade policy

On the first front, I'm thinking of how our trade policy has resulted in (or not helped us avoid) a skyrocketing trade deficit, largely stagnant wages and farm prices, and the loss of millions of manufacturing jobs, hundreds of thousands of family farms, and an increasing number of service sector jobs. Nearly every candidate touches on this part of the issue - even Huckabee and Romney with their comments on manufacturing. (McCain has spoken about compensating losers through TAA.) With the exception of Ron Paul (who calls for scrapping the WTO, NAFTA, etc. directly), the whole field talks about the losses from trade policy for many people. They are largely silent on the trade-wage connections.

The second category relates to how we make trade policy. For four decades, our trade policy has been conceived under the undemocratic Fast Track mechanism, which takes away Congress' constitutional authority and responsibility to set our trade policy, and gives it to an executive branch that sets the terms and picks the partner countries and writes the deal, leaving Congress only an up or down vote. Obama has talked about replacing Fast Track, while Clinton has said she will hold off from asking for Fast Track until she reviews past agreements.

Finally, as we have long been arguing, trade policy these days is only marginally about trade. Much of the 600-page texts of the WTO and FTAs has to do with how we adopt policies domestically. Thus, a move to universal health care could be challenged as a limitation on market access for health insurance companies. Under our FTAs, investors can demand taxpayer money for public interest policies that limit their future expected profits. Obama has addressed investor-state, consumer protection, and domestic regulation. We haven't heard much from the other candidates on this dimension.

As we'll document in an upcoming report, both the Dem and GOP health care and climate change proposals could face WTO challenge. More specific responses to these and other questions can help voters can make an informed choice.

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