McCain pledges allegiance to NAFTA

Like Wesley Clarke said, nobody is questioning McCain's military service, his love of this country, or ignoring his time as a POW. But flying a plane while in uniform does not automatically mean you have the judgement necessary to be President. And McCain's stance on NAFTA is further proof of that.

While the rest of the country is celebrating America's independence this week, John McCain is instead heading to Mexico City after a trip to Colombia to pledge support for the pending free trade accord. In contrast, Obama heads to Ohio to promote his "protectionist" policies.

Yes, McCain will really be in Bogota today and Mexico City tomorrow, a week after visiting Ottawa, championing NAFTA to business elites in those countries. "We need stand up for free trade with no ifs, ands or buts about it. We let trade and globalization be politicized at our own peril."

He promises to never "dishonor" America by moving away from the "sacred" NAFTA treaty. He talks on the dangers of "mindless protectionism" and expresses his faith in the ability of American workers to compete with anyone anywhere.

Unfortunately, he doesn't get it. For years, Republicans have stood by those statements. Trade, by definition, benefited America. Sure, a few privileged union workers might lose their cushy jobs and padded salaries, but they would find new jobs in the expanding global economy. Americans would prosper from investments abroad, our financial services industry would capture the high end of the expanded world economy; we'd sustain our manufacturing edge by becoming more productive; we'd benefit from lower priced goods imported from abroad.

Except it hasn't quite worked out that way. Productivity went up, but wages didn't. Corporations used the threat of moving overseas to cut back on salaries, job security, and benefits like health care and pensions. Families went deeper into debt as the cost of basics -- education, health care, retirement security, and now food and gas -- soared. More and more workers lost good jobs, only to be forced into those that paid less with fewer benefits. And now with the global workforce effectively doubled as China, India and Russia modernized, it isn't just industrial workers at risk, but some 30 million jobs that could face off-shoring. Financial services did prosper, until their greed and gambling blew up in the housing bubble.

The US has gone further and further into global debt, with trade deficits that are still $2 billion a day despite the decline in the dollar. Last month, the Chinese announced they were netting $2.5 billion a month -- $100 million an hour -- in foreign exchange. Their sovereign investment funds are now hunting for good deals across the world.

NAFTA, sold as a source of jobs for the US and a solution to the immigration flows from Mexico, hasn't worked that way either. Our trade deficit with Mexico has gone from a basic balance before NAFTA to an all-time high of $74.3 billion last year. Mexico now exports more cars to the United States than the US exports to the world. Let that sink in for a moment.

And let's not forget about how immigration tensions have grown as small farmers got displaced in Mexico by subsidized US food exports and started coming North in large numbers.

Elites found ways to protect themselves. Lawyers, doctors, prescription drug companies use licensing and patent laws to protect their wages and profits, but most Americans worry about how their kids were going to sustain a middle class life style. Globalization isn't the only reason the middle class is declining -- the war on labor, etc. contribute -- but it certainly is a significant part of the reason.

And across the world, developing countries discovered the NAFTA model didn't work for them either. The countries that have enjoyed success -- China, India, Korea -- play by a very different set of rules. They target industries, and pursue aggressive mercantilist policies to capture export markets. They run up large foreign reserves to be able to protect their currencies from global speculators. China's bosses have been happy to lend us the money to keep buying the goods our companies were making over there -- and will manipulate the value of their currency until they capture the markets they are seeking. But it is hard to argue, as McCain does, that free trade is spreading democracy across the world when the most successful economy is a communist dictatorship.

Across the world, the revolt against the corporate trade model is growing. In the US, a majority -- 58% -- of those polled in a January 2008 Wall Street Journal/NBC survey agreed that "globalization has been bad... because it has subjected US companies and employees to unfair competition and cheap labor."

We face not a choice between "free trade" and "isolationism," as McCain claims, but the challenge of developing a serious strategy for sustaining a robust middle class in a global economy. It isn't a choice between keeping our word and "dishonoring" our commitments, but making a clear reassessment of how we get out of the hole we are in.

We need to support the TRADE Act. The act calls for a halt on all new trade accords until the US Comptroller General undertakes a comprehensive assessment of the benefits and the costs of our current agreements, looking at who has benefited -- here and abroad -- and who has suffered. The Act then calls for developing a strategy that insures that the benefits of trade are widely shared, that we pursue a policy designed to benefit working people and Main Street, and not simply Wall Street.

Obama, for all he has been accused of being inexperienced, has laid out elements of an alternative strategy that may form the basis of a new course. Check it out here:
http://www.washingtonindependent.com/view/obamas-alternative

McCain's response to this has been like an Inquisition priest discovering free thinking in the pews. Doctrine is sacrosanct. Questioning it is dishonorable. He calls upon Americans to sustain the course we have been on, like lemmings marching stolidly to the sea. He pretends this is an American tradition, claiming that "every time the United States has become protectionist... we've paid a very heavy price" But this ignores the entire history of this country's rise -- with sharp eyed mercantilist trade policies behind tariff walls -- to a world economic power with a broad middle class. "Yankee traders" were famed for cutting a tough, practical deal, not for sacrificing their interests for ideological principles.

Nor is McCain such an innocent. He says we mustn't "politicize" trade accords, but trade accords are already heavily politicized. Every trade agreement -- particularly NAFTA -- features fierce lobbying over every clause.

The bottom line is that McCain seems to want to make trade policy a centerpiece of his election campaign. Obama should take him up on it. Let McCain stump the business elites of Mexico City, Bogota and Ottawa. Obama can continue to speak to the concerns of working people in Zanesville and Flint and Pittsburgh. Let voters decide which candidate has his priorities right.