True test of bipartisanship

NAFTA: A

August 18, 1993|By Robert Kuttner

IN SIGNING the long-delayed budget package, President Clinton challenged the Republicans to embrace a new bipartisan spirit. As it happens, bipartisanship is likely to occur -- with a vengeance -- on the very next piece of major legislation to come before Congress. This would be the North American Free Trade Agreement (NAFTA), which will be sent to Congress in September.

If Congress does approve NAFTA, a majority of the votes will likely come from Republicans. Indeed, the coalition that supports Bill Clinton on NAFTA will be the same one that opposed his budget -- Republicans and mainly conservative Democrats.

NAFTA was conceived by the Bush administration, and it reflects a conservative philosophy of economics. The idea is that North America -- the United States, Canada, Mexico -- is or should be one big happy free market. The plain differences in living standards, wages and environmental protections are simply wished away.

NAFTA troubles a majority of House and Senate Democrats because it is likely to cause a net loss of American jobs. As a recent report to the House Democratic Study Group documented, wages in Mexico are lagging far behind Mexican productivity, and hence Mexican wages are likely to drag American wages down.

The fantasy of NAFTA is that bad, low-wage jobs will migrate to Mexico, while the good ones stay here. But increasingly it is good jobs that are migrating south.

In a year when jobs are a key issue, it is not surprising that the average rank-and-file Democratic congressman has little enthusiasm for NAFTA. The president will have to twist arms mightily in order to muster enough votes for passage, and Republicans will enjoy the open split in his own party.

Candidate Clinton backed into support of this Republican idea. As a free-trader and as a "different Democrat," he was eager to demonstrate his bona fides to big business, which likes NAFTA. To appease skeptical liberals, he promised that he would modify NAFTA to add labor and environmental standards.

However, the proposed side agreements, now in the final stages of negotiation, do little to address the underlying problem of gross disparity in wages and standards. At most, they provide a very cumbersome appeals process if Mexico (or Canada) allegedly fails to enforce its own labor or environmental laws.

But the side agreements fail to require any upgrading of Mexican laws. Thus, if Mexican minimum wage laws, or child labor laws, or toxic waste regulations are far more lax to begin with (which in fact they are), the proposed side agreements provide no recourse.

This is what Mr. Clinton will have to sell the Democratic Congress -- which has just loyally walked the political plank in order to vote massive tax hikes and spending cuts. For the second time in a row, Mr. Clinton will ask liberals in his own party to vote for a quite conservative program, out of loyalty to him.

The key figure in this coming legislative battle is the House majority leader, Richard Gephardt of Missouri. Mr. Gephardt does not like NAFTA. He supported enabling legislation only after being assured that Mr. Clinton would negotiate tough side agreements. He has vowed to vote against it, if the agreements are not adequate.

In the end, however, I suspect Mr. Gephardt will support his president. As Mr. Clinton's floor leader in the House, Mr. Gephardt simply cannot hand the president a humiliating legislative defeat. And Mr. Gephardt will take with him the 20 or 30 moderate Democrats necessary for NAFTA to pass.

There is a distressing pattern here. Conservative Democrats regularly vote against Mr. Clinton with impunity. Liberal ones loyally support him, and are taken for granted.

(The same pattern is likely to occur yet again, when the Clinton health reform comes before Congress. More than 100 liberal legislators, who would have preferred a Canadian-style true national health system, will swallow hard and support Mr. Clinton's watered-down plan out of partisan solidarity.)

NAFTA is an overrated trade deal -- and something of an overrated controversy. It will neither deliver the benefits its proponents advertise, nor the harm its detractors fear. The deeper trade problem is that even without NAFTA lots of good jobs are migrating to Mexico and other low-wage areas, and the administration has no strategy for dealing with this dilemma.

This time, if rank-and-file liberal Democrats loyally vote for unpopular and dubious legislation, they should at least get something in return. Mr. Gephardt, in particular, is well-positioned to advise the president that he can't keep delivering Democratic votes for unpopular programs unless he can deliver something to his caucus.

One good quid pro quo would be a commitment by Mr. Clinton to get off the austerity kick and fight for a serious jobs and public investment program. If the economy stays stuck in first gear, Mr. Gephardt's 256 House Democrats will need all the help they can get when they face the voters next year.

Robert Kuttner writes a column on economic matters.

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