March 25, 2008

By Jim Tankersley

Washington Bureau

WASHINGTON — Sen. Bernie Sanders believes the country is ready to join his fight to overhaul American trade policy. He wants to believe Barack Obama and Hillary Clinton are too.

Sanders, a liberal Vermont independent who caucuses with Democrats, is a leader in the growing group of lawmakers who blame expanded trade for lost manufacturing jobs and stagnant wages for American workers. The campaign for the Democratic presidential nomination would appear to promise them a crowning achievement: Both Obama and Clinton say they'll renegotiate the North American Free Trade Agreement and push for a more worker-friendly trade model if elected.

But many in the "fair trade" crowd aren't celebrating yet, and free-traders, particularly among Democrats, don't look worried. They have heard this before, and many of them doubt Obama or Clinton would make good on their tough talk.

"I don't know if they're really serious about going back and redoing NAFTA," said Rep. Steny Hoyer (D-Md.), the House majority leader. Hoyer supports increased trade, as does Rep. Rahm Emanuel (D-Ill.), the House Democratic Caucus chairman. Emanuel notes that both Clinton and Obama backed a recent trade deal with Peru. "That's all I have to say," he said.

Sanders seems cautiously optimistic at best. "It doesn't take a PhD in economics to see when you go shopping the only products you can afford are made in China," he said. "The American people know it, and I hope our candidates learn it."

Some of his allies are more hopeful: "The winner, Hillary or Barack, will come to Congress [as president] with a different trade policy," said Sen. Sherrod Brown (D- Ohio). "They'll follow through."

A winning issue?
Brown, Sanders and other Senate and House candidates ran on trade reform in their winning 2006 campaigns. Clinton and Obama began to pound the issue in the run-up to Ohio's March 4 presidential primary. They denounced "job-killing" trade deals and promised to crack down on companies that ship factory work overseas, drawing cheers in a state where dwindling manufacturing employment and soaring foreclosure rates have ratcheted up voters' anxieties.

Exit polls showed 4 of 5 voters in Ohio's Democratic primary believe trade deals with other countries take jobs from their state. The numbers figure to look similar in Pennsylvania, which is one state east of Ohio in the Rust Belt and holds its primary April 22. Nationwide, a Wall Street Journal poll last fall found 6 in 10 Republicans say trade deals have been bad for the U.S. economy.

Before the Ohio primary, which Clinton won by 10 percentage points, each Democrat accused the other of saying one thing on trade but meaning another. Those criticisms persist.

Clinton's campaign cites news reports that Obama's top economic adviser met with Canadian officials to reassure them over not wanting to change NAFTA. Obama's campaign says Clinton advocated for NAFTA when her husband, then- President Bill Clinton, was pushing the deal through Congress. Each candidate denies the other's charge.

Both Clinton and Obama voted for a trade deal with Oman in 2006. They both supported the Peru agreement last year, though they missed the Senate's vote to approve it while campaigning. Both voted against the signature trade deal of the Bush administration, the Central American Free Trade Agreement.

Experts disagree on how trade has affected the nation. Liberal economists, for example, blame NAFTA alone for the loss of tens of thousands of Ohio jobs. More conservative economists say Ohio's increased exports due to trade agreements have created more than enough jobs to make up for those lost to outsourcing. A wealth of data suggest the deepest sources of Rust Belt decline are a lack of educated residents and marketable ideas.

'A stark difference'
Analysts expect trade to factor heavily in swing manufacturing states such as Ohio, Pennsylvania and Michigan this fall. The differences will be clear: Sen. John McCain of Arizona, the presumptive GOP presidential nominee, has a pro-trade voting record. He extolled its benefits during the Ohio primary campaign.

"There will be a stark difference" on trade in the general election, said Scott Paul, director of the Alliance for American Manufacturing, which supports revamping trade deals to benefit domestic workers. "John McCain has made it clear that he is philosophically disinclined to do anything on this issue."

Still, Paul said this week he hasn't heard the detail he'd like from Obama or Clinton on how they would change America's trading relationship with China, which ranked as the chief concern among those who attended a series of trade "town halls" his group had in the past six months. Asked if he believes either Democrat would fundamentally alter trade policy, Paul said, "It's too early to tell."

The Democrats' rhetoric has jarred some trade proponents. But for the most part, it hasn't worried them.

"There obviously has been a lot of rhetoric and discussion on the campaign trail," said Christopher Wenk, the senior director for international policy of the pro-trade U.S. Chamber of Commerce. "You talk to anybody in Washington; I think there are concerns there about what's being said. But many of us, myself included, are taking this with a grain of salt. ... Bashing NAFTA plays well with Ohio voters."

Decades of bipartisan consensus on free trade are "under pressure" in Washington, said Peter Orszag, a former Clinton administration adviser who now directs the non-partisan Congressional Budget Office. Economic uncertainty, he said, is causing many voters to consider "throwing sand in the wheels of markets."

"My experience suggests," he continued, "when perceptions shift, policy proposals are not far behind."