A Pyrrhic victory on NAFTA

Robert Kuttner

November 19, 1993|By Robert Kuttner

PRESIDENT Clinton's win on NAFTA gives new meaning to the term Pyrrhic victory. The win is being interpreted as a broad boost for his presidency. It shows he can stay focused, mobilize the power of his office and tame Congress and interest groups on behalf of a larger national purpose.

Think again.

In the short run, the win indeed makes him more presidential. But consider the hidden costs. While NAFTA has consumed attention and political capital, the White House has ignored other battles far more consequential to Mr. Clinton's eventual success.

For example, Reps. Tim Penny, D-Minn., and John Kasich, R-Ohio, are pressing a budget amendment to cut federal spending by $90 billion over five years below the 1993 budget cap. A vote is tentatively scheduled tomorrow and is expected to be close.

The amendment is supported by a coalition of Republicans and center-right Democrats -- the people who backed NAFTA. It is nominally opposed by the administration, but nobody from the White House has been working it.

"All of their attention is focused on NAFTA," a Penny aide says happily. "If only they had put one-tenth of the effort into Penny-Kasich that they had put into NAFTA," laments Rep. Henry Waxman, a California Democrat.

Penny-Kasich would slash Medicare and Medicaid by $50 billion -- savings that the administration needs to finance Mr. Clinton's health reform. It would consume every last nickel of domestic discretionary spending, needed to finance other initiatives. Not the least of these are the job training and employment programs that the administration wants so as to make NAFTA's effects bearable to Democratic constituents.

Lately the president has given high-toned, high-profile speeches -- on health, on job security, on crime -- all of which suggest the need for heroic public endeavor and substantial public resources. The crime bill recently passed by the Senate -- putting 100,000 more cops on the street, building more prisons, adding money for drug treatment -- already consumes all of the discretionary money the administration can tap -- and more. As New York Sen. Pat Moynihan quipped the other day, "We just added 48 new hanging offenses to the U.S. Code, but we're out of rope."

The bitter NAFTA fight also weakens Mr. Clinton's health reform. Labor leaders, most of whose members currently have better coverage at lower costs than the Clinton bill provides, nonetheless have been faithfully working to enlist support for Mr. Clinton from their rank and file. This devotion may not continue.

The administration hopes to win support from the nearly 100 House Democrats who back a single-payer health reform XTC alternative. But these are precisely the people whom the White House has savaged for their opposition to NAFTA.

Mr. Clinton might have fought for a real jobs program, or for the kind of public and social investment he keeps invoking in his speeches. He might have chosen to place his presidency on the line to change public and congressional opinion on the deficit-hawkery represented by Penny-Kasich. Instead, he went to the mat for NAFTA. One can only wonder at Mr. Clinton's sense of priorities when greater issues are at stake.

Stripped of the overheated rhetoric, the substantive claims for NAFTA were always modest. The White House says it will produce 200,000 new U.S. jobs -- the number being created in a single month of a tepid economic recovery.

But real recovery -- far more consequential to Mr. Clinton than NAFTA -- remains elusive. By every statistical indication, this is the most feeble economic upturn of the last half-century.

Thirty months after the recession officially ended, unemployment has scarcely budged. At this point in the last three recoveries, employment had jumped an average of 9 percent. In this recovery, it is up less than 1 percent. NAFTA may have been billed as a test of Mr. Clinton's presidency, but its passage will not save that presidency.

On the contrary, the bruising NAFTA battle that Mr. Clinton picked -- win or lose -- is a real setback for the big questions of economic security on which his presidency depends.

And those who think NAFTA suddenly turns the president into a legislative wizard should consider what went into this win. Mr. Clinton's narrow victory depended heavily on Newt Gingrich, the Republican House Whip who delivered 132 votes for NAFTA -- and who passionately opposes just about everything else Mr. Clinton supports.

If anything, the president's reliance on Mr. Gingrich for this win -- only 102 Democrats voted for NAFTA -- strengthens Mr. Gingrich and the House Republicans. The NAFTA coalition does portend other legislative victories, but not for Mr. Clinton. It is the same coalition of Republicans and conservative Democrats that has blocked progressive legislation for decades. Mr. Gingrich is not going to lift a finger to defeat Penny-Kasich, support Mr. Clinton's health reform, increase funding for labor adjustment or any of the other measures that will truly define Mr. Clinton's effectiveness.

President Clinton can savor his success, but the afterglow is likely to be short-lived. As Pyrrhus put it, "Another such victory . . . and we are undone."

Robert Kuttner writes a column on economic matters.

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