Where Trump & San­ders Meet

The Economic Times - - Breaking Ideas - Sandip Roy

Un­til now, most of us had been watch­ing the Amer­i­can elec­tions much as one watches a freak show — with a mea­sure of mor­bid fas­ci­na­tion but also serene de­tach­ment. These were loud blus­ter­ing char­ac­ters in a for­eign sit­com, some­one else’s headache.

But a re­cent in-depth New York Daily News in­ter­view with Bernie San­ders, the Ver­mont se­na­tor who is deny­ing Hil­lary Clin­ton a cake­walk to the Demo­cratic nom­i­na­tion, should give us pause. The US pres­i­den­tial race might be about to af­fect the rest of us as well.

San­ders was asked about free trade. His re­sponse prompted an ar­ti­cle on Vox head­lined ‘If you’re poor in another coun­try, this is the scari­est thing Bernie San­ders has said’ (goo. gl/u2gfVL). San­ders said, “You have to have stan­dards. And what fair trade means to say that it’s fair. It is roughly equiv­a­lent to the wages and en­vi­ron­men­tal stan­dards in the US.”

That’s not In­dia. Or China. Or Mex­ico for that mat­ter. In fact, San­ders’ web­site spells it out even more ex­plic­itly. He wants to re­verse free trade agree­ments (FTAs) like the North Amer­i­can Free Trade Agree­ment (Nafta) that binds the US, Canada and Mex­ico, the Cen­tral Amer­i­can Free Trade Agree­ment (Cafta), and Per­ma­nent Nor­mal Trade Re­la­tions (PNTR) with China. And San­ders has a lot of sup­port on the ground in the US for that. FTAs have hit many Amer­i­cans hard even as they have ben­e­fited many oth­ers. In 1992, pres­i­den­tial can­di­date Ross Perot fa­mously warned Amer­i­cans about “a gi­ant suck­ing sound of jobs be­ing pulled out of this coun­try” thanks to Nafta. But Perot was just the prickly ornery in­de­pen­dent. Both San­ders and Don­ald Trump have brought the anti-free trade mes­sage right into the po­lit­i­cal main­stream. And this is no longer cam­paign lip ser­vice. They are se­ri­ous about it be­ing nei­ther fair nor lovely. San­ders was once on the picket line to protest Nafta. He led a failed ef­fort to re­verse PNTR for China. This is one area where Trump and San­ders find com­mon ground. Trump, whose re­la­tion­ship with facts is usu­ally ten­u­ous, is known to fin­ish his sen­tences when he gets talk­ing about trade. His pet peeve is about $500 bil­lion trade deficit with China. He’s threat­ened a 45% tax on Chi­nese goods. He calls these deals “stupid trade”, not “free trade”. And in his ‘Magic Trump’ way, he air­ily prom­ises, “I’ll make them good deals.”

But Trump has spe­cific warn­ings too. If Ford wants to build cars in another coun­try, that’s fine. But Pres­i­dent Trump wants a stiff tar­iff on ev­ery ve­hi­cle it brings into the US. And there are a lot of laid-off au­towork­ers who will agree. Asked if he agreed with Trump on trade, Sand- ers told the New York Daily News, “Well, if he thinks they are bad trade deals, I agree with him.”

That puts Hil­lary Clin­ton in a tricky spot. Un­til now, Repub­li­cans like Bush Sr and Jr stead­fastly sup­ported these trade deals. Democrats like Bill Clin­ton claimed to “feel the pain” of those who lost their jobs, but then sup­ported those deals any­way. Can­di­date Obama spoke out against Nafta. But Pres­i­dent Obama cham­pi­oned other FTAs.

Hil­lary Clin­ton has been cut from the same cloth. She has had her mis­giv­ings about Nafta, but de­fended it to labour unions. She voted against Cafta as se­na­tor. But as Obama’s sec­re­tary of state, she wrote a 5,600word cover story for For­eign Pol­icy mag­a­zine (‘Amer­ica’s Pa­cific Cen­tury’, Oc­to­ber 11, 2011, goo.gl/ DssNmU) tout­ing the 12-na­tion Trans-Pa­cific Part­ner­ship (TPP) trade deal as the “gold stan­dard in trade agree­ments”.

Now as can­di­date Clin­ton, she has come out against the very same TPP trade deal. “I don’t be­lieve it’s go­ing to meet the high bar I have set,” she said in an in­ter­view with PBS. The bar was clearly low enough for her to flip-flop over it.

It’s un­de­ni­able, says a 2016 Na­tional Bu­reau of Eco­nomic Re­search study (goo.gl/TU8LkV), that lib­er­al­is­ing trade has hurt the Amer­i­can work­ing class and dec­i­mated the US man­u­fac­tur­ing in­dus­try, though it might have ben­e­fited the Amer­i­can con­sumer. But go­ing the other way could hurt the global poor even more. How­ever, the global poor gets no vote in Amer­i­can elec­tions.

En­ter from stage left the Panama Papers. Hil­lary Clin­ton as Obama’s sec­re­tary of state helped push through the Panama Free Trade deal, the same deal she had op­posed as can­di­date in 2008. San­ders had warned in 2011that Panama was a “world leader when it comes to al­low­ing large cor­po­ra­tions and wealthy Amer­i­cans to evade taxes”. Clin­ton had pooh-poohed those fears say­ing it would make it eas­ier for Amer­i­can com­pa­nies to sell their prod­ucts.

Now 2.6 ter­abytes later, San­ders can just sit back, shrug, and say “I told you so.” There’s no free lunch in politics. And no free ride for free trade any more.

While Hil­lary sells a turkey: Free­dom From Want (1942), Nor­man Rock­well

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