Behind the Dreadfully Named Mini-scandal NAFTAgate and Other Nonsense

(Robin Sears – Hill Times)

It took a passing remark from Prime Minister Harper’s chief of staff, Ian Brodie, in a budget lockup discussion with a few reporters, to set off the firestorm that became NAFTAgate.

The pharaohs did it. English kings do it. Every government does it. Let’s all do it, let’s fall in love ... with bashing foreign trade. Second only to a war abroad as the best distraction from problems at home, the most venerable political device for a candidate or a government in trouble is to blame wicked foreign traders for domestic economic ills.

The Rosetta Stone records that the good pharaohs defended the interests of local business over foreign traders. The Magna Carta required English kings to respect the tariff rights of local barons over foreigners. And American governments from George Washington to George W. Bush have succumbed to trade bashing when it served a short-term domestic agenda. In Bush’s case, attacking foreign steelmakers so outrageously, in order to protect Republican mid-term election prospects and America’s failing local producers that he nearly launched a two-front trade war with Europe and Asia.

Canadians were players at this “beggar thy neighbour” game for most of our history, but we seem to have given up the addiction. Sadly, we may have swapped fighting trade skirmishes with the Americans for complacency about the protections that NAFTA delivers from their America-firsters. The foolishness of that complacency is starkly revealed by the proposed “sale under duress” of MacDonald, Dettwiler’s Canadarm and related space assets to American investors—a painful prospect for further consideration below.

U.S. Democratic presidential candidates were at it again this spring. This time foreign traders became NAFTA beneficiaries. No one much noticed or cared when John Edwards and Bill Richardson were blaming NAFTA for American economic woes this past winter. Dick Gephardt and Paul Tsongas had made many of the same shopworn populist attacks on the inimical impact of free trade in the first Bill Clinton election in 1992. Clinton the First had the wit and the gravitas not to fall into the trap they set for him among worried working-class Democratic voters.

Sadly, Hillary Clinton has shown none of the same smarts as her husband, nor has Barack Obama. Both have committed to a level of NAFTA attack that will humiliate them in office, and do little to get them there. Campaigning in the Rust Belt states where steel, auto and manufacturing jobs have been decimated, it is easy and cheap politics to assuage the angry unemployed by blaming foreigners. It has little to do with economic reality, however, and even less to do with NAFTA. Canada-U.S. trade has boomed since its passage.

Even in Ohio, where Clinton and Obama descended to populist insults against each other and “disloyal companies,” trade with Canada has grown much faster than either the local economy or their trade with anyone else. Read the whole article.