Clinton and Obama: Talking Tough -- but Not Too Tough -- on Trade

Ann All

Back in July, I blogged that Democratic presidential candidates Sen. Hillary Clinton (N.Y.) and Sen. Barack Obama (Ill.) were finding themselves between a rock and a hard place on offshoring. This is understandable, since two traditionally Democratic constituencies, high-tech companies and labor unions, come down on opposite sides of the global trade issue.

 

Now they find themselves in an even more uncomfortable spot, thanks to a shrinking middle ground. Savvy candidates try to avoid taking positions they may later come to regret. Yet this is tough to do on an issue as nuanced as trade. (Or, as I noted in November, on the related issue of immigration.)

 

Clinton is trying her darnedest to present herself as a critic of the North American Free Trade Agreement (NAFTA), despite her apparent past support for the 1993 policy. As syndicated columnist David Sirota points out, Obama -- who, unlike Clinton, has few NAFTA sound bites in his past -- is using Clinton's past remarks to cast her as a candidate who cares more about big business than "ordinary" Americans.

 

NAFTA has become a bit of a bogeyman, writes Sirota, citing poll numbers that show large numbers of Americans believe NAFTA and other trade policies have been bad for the U.S. economy.

 

(Is this true? Not according to a Cato Institute study, which found that most Americans are "measurably better off today after a decade of healthy trade expansion." Indeed, the rising costs of health care, U.S. agricultural policies and other non-trade-related market forces relate more directly to current economic troubles. )


 

Obama last August introduced the Patriot Employer Act, which would offer tax breaks for U.S. corporations that keep their headquarters on American shores, maintain a certain ratio of U.S.-based employees to foreign employees and provide worker-friendly benefits.

 

As Salon's Andrew Leonard notes, some economists havetaken Obama to task over the legislation, with the UK's Willem Buiter and Anne Sibert calling it "reactionary, populist, xenophobic, and just plain silly." Yet their arguments are likely to fall on deaf ears in Ohio, site of last night's debate between the two candidates and home to a manufacturing-centric economy that hasn't recovered from its loss of jobs over the past decade.

 

While both candidates are ratcheting up the rhetoric on trade, they are offering little in the way of concrete solutions, reports the International Herald Tribune. Instead, they are practicing the kind of fence-straddling that many Republican candidates use to address one of the GOP's most highly-charged issues, abortion.

This straddling has served Republicans well. They have been able to win over voters who care about abortion above all else without alienating swing voters, most of whom, polls show, think it should be legal at least some of the time. Talking tough and governing gently helped the party build a majority.

The article goes on to cite some expert suggestions for reinvigorating America's economy, including boosting government investments in infrastructure, tweaking the tax code to help Americans who lose their jobs, and promoting medical sciences, alternative energy and other sectors that can produce high-paying jobs. (In a similar vein, I blogged in October about the U.S. manufacturing industry's need to adopt a business model that emphasizes advanced technology over manual labor.)

 

The problem with these ideas is that they don't offer any immediate payoffs and are thus unlikely to get the attention of voters. According to the Herald Tribune:

They will do little to help former factory workers who have had to take lower-paying jobs -- which is one reason that calling for new investments doesn't bring nearly the cheers on the campaign trail that denouncing NAFTA does.


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