In Following a Campaign Rite, Scorn Is Heaped on Accord By Some of Those Who Praised Its Creation

by Tim Harper

WASHINGTON-When U.S. President George W. Bush stood beside Prime Minister Stephen Harper this week extolling the benefits of NAFTA, he was pumping up a trade pact that is under increasing pressure here.

It has become a convenient target for those seeking the 2008 Democratic presidential nomination who are following a campaign rite of demonizing trade deals to appease the party's labour base before moving to the centre during the general election. [1]

But in 2007, the North American Free Trade Agreement is under more concerted attack than perhaps any time since it was signed at the beginning of 1994, and Democrats have high hopes of regaining the White House they lost in 2000 to Bush and the Republicans.

Those who are now raining scorn on the deal were among those who heaped praise on it when it was being negotiated 14 years ago.

"I had said for many years that NAFTA and the way it's been implemented has hurt a lot of American workers," says Democratic frontrunner Hillary Clinton, who was the country's first lady when her husband, Bill Clinton, signed the deal.

Clinton had turned to a key Democrat ally of the day, Bill Richardson, now New Mexico governor and a 2008 contender for the presidential nomination, to get Democrats onside to back the deal.

"We should never have another trade agreement unless it enforces labour protection, environmental standards and job safety," Richardson says now.

Illinois Sen. Barack Obama, Hillary Clinton's main rival for the Democratic nod, says he would "immediately call the president of Mexico and the president of Canada" - betraying a lack of knowledge of the Canadian political system - to amend NAFTA to get more favourable labour language in the deal.

Former North Carolina senator John Edwards, who has sought to fashion himself as labour's Democratic presidential hopeful, devoted an entire speech to trade deals and their harm in Cedar Rapids, Iowa, earlier this month.

"NAFTA was written by insiders in all three countries and it served their interests, not the interests of regular workers,'' Edwards, the Democrats' 2004 vice presidential candidate, said.

He said the deal gave unprecedented rights to corporate investors, but no protection for labour or the environment.

"Over the past 15 years, we have seen growing income inequality in the U.S., Mexico and Canada.

"Well, enough is enough.''

While Edwards and Obama would seek revisions or amendments to the tripartite trade agreement, only long shot Democratic presidential hopeful Dennis Kucinich, an Ohio congressman, would pull the U.S. out of the deal.

What does the trade trash talk mean for Canada?

"They're playing to their base, or their base instincts,'' says Elliot Feldman, a Washington-based trade expert.

Feldman wishes to inject a bit of reality into this debate, suggesting the Bush administration's commerce department is the most protectionist he has encountered in years of trade law, turning the traditional wisdom that Republicans are free traders and Democrats are protectionists on its head.

Neither Canada nor the U.S. is respecting the terms of NAFTA right now, he says, pointing to the U.S.-launched arbitration of the softwood lumber deal before the London Court of International Arbitration. It is the first time two countries have argued a dispute before a court that handles private commercial disputes.

Feldman also maintains that NAFTA was working in the softwood lumber negotiations and Canada would have ultimately won every dispute under NAFTA rules.

"Harper gave it all away in his determination to make nice with the Bush administration,'' he said.

"He gave away $1 billion.''

He was referring to the $1 billion (U.S.) Harper allowed the United States to keep as its share of the $5 billion (U.S.) it extracted in tariffs from Canadian companies under terms of the 2006 deal.

Although most trade analysts believe there is little danger in talking to a new administration about improvements or reforms to the deal, they fear the entire pact would unravel if it was formally reopened.

Under NAFTA, Canada boasts a $96 billion (Canadian) trade surplus with the U.S., a gap that rankles opponents here.

Bush told reporters after this week's NAFTA leaders' summit in Montebello, Que., that the accord had boosted Canada-U.S. trade from $293 billion (U.S.) per year to $883 billion (U.S.) per year.

"Now, for some those are just numbers, but for many it's improved wages and a better lifestyle, and more hope,'' Bush said.

The key for the deal is increased prosperity for all three countries in the North American "neighbourhood,'' Bush argues.

His trade representative, Susan Schwab, told a meeting of ministers of the three countries earlier this month in Vancouver that trade between the U.S., Mexico and Canada tripled since NAFTA took effect.

The U.S. has free trade agreements with 14 countries, 11 since Bush took office in 2001, and 42 per cent of all its exports go to free trade partners. But many Democrats argue only big business benefited from the deals.

Two more free trade deals, with Peru and Panama, still require congressional approval this fall, but Democrats were successful in inserting labour and environmental standards, the language they say NAFTA lacks.

International Trade Minister David Emerson attempted to calm Canadian nerves following the Vancouver meeting.

"People are basically trying to appeal to their party roots,'' he said.

"Until you get into a general election ... you don't have the same kind of moderating impact that perhaps one once saw.''
© 2007 The Toronto Star