Posted on November 15, 1993 in Washington Watch

The White House is engaged in a major campaign to pass the North American Free Trade Act (NAFTA) through Congress. With the vote set for November 17, both pro- and anti-NAFTA forces have been waging a relentless crusade to collar enough votes to win.

NAFTA is an inheritance of the Clinton Administration. Initially negotiated by the Bush Administration with Mexico and Canada, the issue became a topic of intense debate during the 1992 presidential campaign.

The basic principle behind NAFTA is that the absence of tariffs and other trade barriers between nations benefits the businesses and consumers of those nations. Businesses can greatly expand their production (and hence profits) in the larger market, while the larger market also creates more intense competition among producers, of which consumers are the beneficiaries. But there are two other important factors at work.

When NAFTA was first being negotiated, the U.S. already had a free trade agreement with Canada, so the treaty actually only expands the size of the free market area. The agreement with Canada had been relatively easy to forge, given the relative similarities between the U.S. and Canadian economies. The primary sticking points in the agreement were Canadian concerns about the U.S. “dumping” surplus agricultural production and thus hurting Canadian farmers; and the fact that the U.S. has more lax environmental standards than Canada, which put Canadian firms at a relative disadvantage with the U.S. competitors. Both of these concerns apply even more to Mexico than to the U.S., which was why the Bush Administration had a more difficult time negotiating NAFTA.

The other point worth mentioning is something that made helped to make NAFTA easier than it would otherwise have been. In the late 1980s and early 1990, there was a great deal of concern about the coming merger of the European Economic Community (EEC). There was a concern on this side of the Atlantic that a “fortress Europe” would be created, which would make it very hard for any non-EEC products to get into that large and lucrative market. The only way to fight back would be to be a part of another major trading bloc which could negotiate better concessions than could individual nations—even one with the economic power of the U.S. (During this period there was also a strong attempt led by Japan to for a common market for the states of the Western Pacific.)

NAFTA is strongly supported by the Republicans in Congress, but traditional Democrats, led by organized labor and environmentalists oppose the agreement, arguing that it would cost the U.S. too many jobs and that it would lead to even greater environmental destruction. Organized labor is concerned that cheap labor costs in Mexico have always been a inducement for U.S. businesses to relocate there, and that the elimination of U.S. tariffs with Mexico removes the last major disincentive to such moves. Environmentalists point to the extremely lax enforcement of what environmental laws are on the book in Mexico, and say that growth of the Mexican economy will promote even worse pollution and endanger the environmental well-being of the Western Hemisphere.

Candidate Bill Clinton took a very different position than these two Democratic constituencies. He refused to oppose the agreement, saying that he supported the concept of a NAFTA but would, if elected, negotiate several side agreements in order to provide for some environmental security, and would pass legislation to provide for retraining programs for any U.S. workers who might lose their jobs. And, in fact, the Clinton Administration has negotiated these side agreements with Mexico and Canada; and some, though not all, environmental groups have come to support the pact. But the promised job retraining programs have done nothing to soften labor opposition to the pact.

The anti-NAFTA forces began their campaign early and have waged a real battle. Led by organized labor and old-line liberals like Ralph Nader and Jesse Jackson, as well as populist Ross Perot, and much of the Democratic congressional leadership, they have succeeded in winning major portions of the traditional Democratic coalition to their cause. On the other side, although businesses and other pro-NAFTA Groups have invested significant resources in their effort to pass the bill, their lobbying work began late and so far has not yielded much in the way of results.

From the outset, NAFTA had a core of Republican support and little Democratic support. Because the strongest forces in the Democratic party were opposed to the bill, even those Democrats who supported the bill were wary of publicly expressing their support. And because his agenda was filled with so many other issues, Clinton did not turn his full attention to NAFTA until just a few weeks ago. But now the President and the rest of the White House and much of the Cabinet are engaged in a full press to win passage of the bill.

Clinton has called most of the congressional Democrats who have said they are undecided on the agreement, and he has met personally with or invited to dinner at least 60 Democrats in an effort to win them over. Daily, the White House announces one or a few members of Congress who the President persuaded to support NAFTA. But it is not the mere power of words or reasoning that is winning Clinton these new votes: it is horse-trading of the first order.

And he is bargaining. To win over some Southern Democrats from sugar and citrus producing states, Clinton announced concessions which will provide more protection for U.S. sugar and citrus producers. To some congressmen, the President gave special benefits to their districts, and there has been some talk that the White House is thinking of lowering the proposed tobacco tax in the upcoming health care bill in order to win the support of congressmen from major tobacco-producing states.

At present, with 218 (half of the 435 voting members of Congress plus 1) needed to pass or defeat the bill, the White House still faces an uphill challenge. NAFTA opponents, including the best vote-counter in the House of Representatives, say that they have a firm commitment from 211 members to vote against the bill. The White House currently claims 180 votes in its camp (although an independent count suggests that 160 is probably closer to fact). Over the next few days the White House will intensify its efforts, hoping to increase their total to 210 by the Monday before the vote.

Of the 180 in the White House count, 110 are Republicans and only 70 are Democrats. But most of those 70, and all additional votes that will be gained by the 17th, are the results of the President’s efforts.

Clearly, the President wants to win, and he explains his case succinctly. When given 30 seconds to explain his position, he said,
“NAFTA is important for this country because it means more markets, more jobs. Exports are necessary to build the American economy. Nothing bad can happen if NAFTA passes, it can happen now. It’s also important because it establishes a beachhead in all of Latin America and will help us get trade agreements throughout the continent and with Europe and Japan. That will help our economy to grow. That’s why every living former President’s for it.”

In recent weeks, Clinton has made a number of major addresses in support of NAFTA. At a memorial event for former President John F. Kennedy he spoke of the challenges that Kennedy faced during the Cold War and how he called a new generation to face the challenge of world leadership. Clinton then compared the international challenge of NAFTA to that earlier challenge, and pledged that this generation would not fail.

In another address on a day to commemorate those who died fighting World War I, Clinton compared those who oppose NAFTA with the isolationists and protectionists who threatened to cut the U.S. off from the world after that war. And again, before one of his daily briefings before business leaders, he argued that, should NAFTA Fail, this hemisphere would become more open to Japanese and European competition, which would be a setback for U.S. international trade.

The President’s case is strong but so, too, are the arguments of NAFTA’s opponents. Jesse Jackson, a spokesperson for the traditional left of the Democratic party argues that NAFTA would cost the lowest-paid U.S. workers a loss of their jobs, that the environmental protections in NAFTA are inadequate, that much of the agreement was negotiated in secret without including labor, farmers or environmentalists in the discussion, and that the principles behind NAFTA primarily benefit business and not working people. NAFTA, in Jackson’s words, is a “replay of Reagan-Bush trickle-down economics.”

Though liberals and organized labor were mounting the most effective campaign by using their votes and enormous reservoirs of political campaign contributions, Ross Perot’s opposition to the pact, for quite different reasons, became the focus of the national media’s attention.

Perot has written a book against the pact, done expensive paid television advertising, paid a number of well-publicized visits to Congress to muster support for his position and has been a regular guest on television talk shows where he decries what he sees as the injustice of NAFTA.

The White House played a high risk game last week when it announced that Vice President Al Gore would debate Ross Perot on national television. At first, political analysts worried that the White House had blundered, believing that a stiff Al Gore would be no match for the a witty Ross Perot. The Vice President, the argued, would be playing right into Perot’s hands. And, win or lose, the debate would enhance the legitimacy of Ross Perot.

The White House knew all of this, but chose to take the gamble anyway. They felt that Gore would make an effective case and, because Perot’s popularity was already somewhat in decline, they would put a hole in the balloon of NAFTA’s most visible and vocal opponent.

The verdict after the debate showed that the White House gamble paid off. Gore emerged as a strong debater, and showed Perot to be not in command of his facts and easy to anger. A pre-debate poll showed the public opposed to NAFTA by a margin of 34% for and 38% opposed. The post-debate figures were 57% for NAFTA and 36% opposed. And among the extremely high 25% of all American homes which watched the debate, the Vice President beat Perot by a margin of greater than 2-1.

What the White House hoped to gain from the debate was the perception that those who opposed NAFTA based their opposition more on fear than on facts and that those members of Congress who would some to support the bill did not need to fear the wrath of Ross Perot—who has threatened that in 1994 he will actively campaign against those members who vote for the pact.

While the White House announces new supporters each day, no one is expecting an easy victory on November 17—in fact, most observers feel that a defeat is the more likely outcome. There are varying views on the effect that a win or a loss on NAFTA will have on Clinton. All sides agree, however, that the new effect of either outcome will be short-term.

If the President wins, the victory will be a welcome sign of his ability to muster key congressional votes. He will have put together the strongest ad-hoc coalition of congressional votes ever assembled: 110 Republicans and 118 Democrats of varying ideologies. Politically the victory will be a sign of the “New Democrat” Bill Clinton, a clear sign that he will not be beholden to the “special interests” of the Democratic party and can be a friend to business. The “New Democrat” image is reinforced by the President’s strong anti-crime bill and his upcoming welfare reform package.

On the other hand, even with a win, the President must go back to square one as he immediately turns to his attention to his health care reform bill—a bill that will see many of his NAFTA allies abandon him and many of his NAFTA opponents switching to support him.

If NAFTA doesn’t pass, the President will suffer some international embarrassment. It will also cost him some clout in the U.S. His liberal Democratic opponents will clearly be emboldened, though they will still need to work with the President on health care reform.

Win or lose, Clinton still faces the need to reposition himself as a “New Democrat.” He still faces the same fractured Democratic party—an issue that has plagued him throughout his first year in office. The left and right wings of the Democratic party seem to be drifting ever father apart, with the result that the Democratic majority in Congress means very little. But the faces that Clinton presents—the hard line on crime, fiscal conservative, welfare reformist and foreign policy hawk which appeal to the right; and the social liberal, favoritism of progressive taxation, health care reformist, and promoter of democracy and human rights which appeal to the left—prevent him from forming a stable coalition either in the moderate center or moderate left.

And, of course, Clinton faces a Republican opposition which, though no less fractured internally than the Democrats, can combine to mount significant opposition. Senate Minority Leader Robert Dole has been quite strident in his opposition role, and all indications are that the more contentious Newt Gingrich will replace the more conciliatory Bob Michel and House Minority Leader next year. There will be no comfort for Clinton on the Republican side of the aisle.

It is worth bearing in mind that candidate Clinton was buried prematurely more than once. President Clinton has been called a lame duck several times in his young Administration. Perhaps the future will show that the combination of Clinton’s political skills, and the fact that he is proposing programs to deal with the problems at the forefront of the concern of most Americans, will enable him to build many ad-hoc coalitions over the next three years. In this context, NAFTA will be the second in a series, of which the narrow budget victory was the first installment. Stay tuned.

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