Don't Trash NAFTA
Fallacies of the anti-NAFTA attacks during the democratic primaries. In fact, the 1994 agreement made member countries more competitive.
Fifteen years after its passage by a closely divided Congress, the North American Free Trade Agreement (NAFTA) provides an important lens through which to consider United States trade policy, U.S. politics and some of the effects of globalization. With a new president taking office next year, it is vitally important to draw the right lessons from NAFTA. The United States needs a new trade policy, and it cannot afford to be paralyzed by the continuing debate over NAFTA.
Popular hostility toward the agreement in the U.S. has never been far from the surface. That was evident during this year’s presidential primary season, when the two front-runners for the Democratic Party’s nomination for President, U.S. Senators Hillary Clinton and Barack Obama, both threatened, if elected, to withdraw from NAFTA unless Canada and Mexico agreed to renegotiate. Editorial writers condemned the candidates for political pandering, but a defense of NAFTA in states such as Ohio or Pennsylvania, where the treaty is blamed for job losses, would have been a quick ticket to defeat for either candidate.
NAFTA has left a lasting mark on the politics of trade in the United States. Prior to NAFTA, interest in trade negotiations and trade agreements was limited to affected industries, academics and trade lawyers. But the proposal for a free trade agreement with Mexico—put forth by President Ronald Reagan, negotiated by the first President George Bush and completed by President Bill Clinton—represented the first time that the U.S. had contemplated increased economic integration with a low-wage, developing country. It was NAFTA that engaged the American public for the first time in debating trade and globalization and considering related issues, ranging from environmental safeguards to workers’ rights to border security.
The bitter debate that accompanied NAFTA’s passage was a watershed in U.S. trade policymaking. Even after NAFTA approval, and despite the booming economy of the 1990s, President Clinton’s efforts to obtain trade-negotiating authority were rebuffed four times (in 1994, 1995, 1997, and 1998) by Congress. While global sectoral trade agreements on information technology, telecommunications and financial services were negotiated by the U.S. with broad support and little controversy, anything that could be characterized as “NAFTA-expansion” was anathema to most members of Congress. President Clinton’s hemispheric trade agenda, launched with great fanfare at the 1994 Summit of the Americas, stalled...