Obama Not So Down On Free Trade Afterall

June 19th, 2008 · No Comments · Subscribe to this feed

The North American Free Trade Agreement (NAFTA) was the Pièce de résistance of the Clinton presidency and is likely to form the major part of his legacy. While I have my problems with it (is it REALLY a free trade agreement?), it did represent a symbolic step forward in the drift towards globalization. I say symbolic because there are enough loopholes in the agreement to go a long way towards nullifying many of its promised benefits (think agricultural subsidies). Nevertheless, the fact that it was pushed through by a democratic president went a long way toward quelling populist, protectionist sentiment for a time. It even proved mildly beneficial to all participants involved. Sure we lost some jobs, but we gained many more and strengthened two of our most important trading partners: Canada and Mexico, and strong trading partners mean a strong America.

Mounting Protectionism

But predictably, trade liberalization has been under fire as economic conditions have deteriorated at home over the past year. Democratic presidential nominees Hillary Clinton and Barack Obama have been critical of the agreement, so much so that withdrawing completely was openly advocated. Eventual Democratic presidential candidate Barack Obama called NAFTA “devastating” and “a big mistake” in spite of the fact his own economic advisor has written famously that free trade is not to blame for America’s rising wage gap.

Obama’s strong anti-free-trade rhetoric was a major sticking point for me in his candidicy. Protectionism plays well at campaign rallies full of recently-unemployed midwest factory workers, but it’s not good policy for the nation. Fortunately, Obama seems to be toning down his rhetoric. While he still favors renegotiating many of our foreign trade agreements to “better look after” American workers and enforce labor and environmental standards, Obama admits his rhetoric became a bit overheated on the campaign trail.

This is a positive development, in my mind, since the last thing we need is more barriers to trade. Furthermore, it will almost definitely serve to broaden Obama’s appeal with moderate independents wary of a return to populist economic isolationism. Since his opponent John McCain is a staunch defender of free trade and offers a calm voice of moderation in a maelstrom of panicky economic desperation, Obama will need to avoid extreme positions to win the presidency.

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