Who's more responsible for Trump, "Extreme Progressives" or NAFTA?

NAFTA.jpg

I recently had a political discussion with a friend and the subject of NAFTA came up. He claimed that it was "mutually advantageous for Mexico, the U.S. and Canada. I had been opposed to NAFTA back when it was signed into law in 1993, as well as other so-called "free trade" agreements of the same mold but hadn't really looked at it in a long time, being more recently preoccupied with the Trans-Pacific Partnership or "TPP." So, I decided to take another look and found that it was worse than I had ever imagined.

In 2014 Public Citizen, a non-profit consumer rights advocacy group and think tank founded in 1971, which does not take either government or corporate funds, released a report entitled NAFTA's 20 Year Legacy and the Fate of the Trans-Pacific Partnership. The first thing the report notes is that polls showed "broad opposition to the TPP among Democrats, Republicans and independents of diverse geographic and socio-economic groups." It then poses the question of what could possibly unite such a diversity of Americans otherwise deeply divided along partisan lines? The answer it claims was 20 years of shared experience with NAFTA and other trade agreements of its type.

NAFTA was fundamentally different from past trade agreements in that it was only partially about trade. In the words of the report:

[I]t shattered the boundaries of past U.S. trade pacts, which had focused narrowly on cutting tariffs and easing quotas. NAFTA created new privileges and protections for foreign investors that incentivized the offshoring of investment and jobs by eliminating many of the risks normally associated with moving production to low-wage countries. NAFTA allowed foreign investors to directly challenge before foreign tribunals domestic policies and actions, demanding government compensation for policies that they claimed undermined their expected future profits. NAFTA also contained chapters that required the three signatory countries to limit regulation of services, such as trucking and banking; extend medicine patent monopolies; limit food and product safety standards and border inspections; and waive domestic procurement preferences, such as Buy American policies.

The same sweeping terms were proposed for the TPP, a massive agreement with 11 Asian and Latin American countries that was premised on expanding the scope of the NAFTA model.

When I shared the report with my friend, a self-described liberal Democrat, he criticized it as being "extreme left revisionism," "ridiculous," "pointing blame indiscriminately." Furthermore, he said it was, "not a realistic view," that I "needed to read a more realistic global view" and that, finally, the criticism of NAFTA presented in the Public Citizen report was why, "extreme progressives for all intents and purposes helped usher 45 into office."

So, I read an article he suggested by a "liberal" author. Now my friend was highly critical of my source, so I would note that his was Business Insider, a for profit, corporate publication. The author was Elena Holodny, who graduated from Columbia University in 2014 with a concentration in economics. Previously she had reported for CNBC, NBC News, and WNYC, and also worked at the International Criminal Tribunal for the former Yugoslavia. An impressive resume but I couldn't find anything to suggest that she was politically liberal. The article, Trump wants to renegotiate NAFTA — here's what you need to know can be found here: http://www.businessinsider.com/what-is-nafta-is-it-good-for-america-2017-2

None of the foregoing is necessarily a reason to dismiss anything Ms. Holodny says out of hand, so let's examine a portion of her article.

Holodny observes that:

[I]f the US can grow corn more efficiently than Mexico than it makes more sense for the US to grow a lot of corn and for Mexico to build a lot of cars and then for both countries to trade cars for corn with each other, rather than for each country to less efficiently do both things on its own.

More concretely, one effect of increased economic integration would be for U.S. firms to move production over to Mexico where labor is cheaper.

Holodny doesn’t mention any forms of efficiency available in Mexico other than cheaper labor, so it would appear that this was the main incentive to relocate automobile production south of the border. She also doesn't seem to be bothered by the question of why wages are so much lower in Mexico i.e. is it strictly economic or does politics play a role? In addition, Holodny also makes no mention of the fact that part of the reason the U.S. produces corn so "efficiently" is that both its remaining small farmers and big agribusinesses still receive generous – and one would think "free trade" distorting - subsidies from the federal government.

Public Citizen claims that the export of subsidized U.S. corn under NAFTA's first decade destroyed the livelihoods of more than 1 million Mexican farmers and about 1.4 million additional workers whose livelihoods depended on agriculture. The mass dislocation caused exacerbated the widespread instability and violence of Mexico's spiraling drug war. Desperation led many of those displaced to Mexico's maquiladora factory zone near the border with the U.S. This contributed to both downward pressure on wages in the zone and a doubling of Mexican immigration to the U.S.

As the report notes, NAFTA-style trade agreements also help explain, at least in part, soaring income and wealth inequality in the United States. NAFTA has placed downward pressure on wages for the middle and working-class by forcing better paid U.S. manufacturing workers to compete with poorly paid (and often politically oppressed) workers abroad. The resulting displacement of those better paid U.S. workers has further depressed middle class wages by adding to the surplus of workers seeking lower-paying service sector jobs. NAFTA also contributes to rising inequality by enabling employers to threaten to move their companies overseas during wage bargaining with workers. For instance, the Public Citizen report cites a Cornell University study commissioned by the NAFTA Labor Commission which found that after the passage of NAFTA, as many as 62 percent of U.S. union drives faced employer threats to relocate abroad, and the factory shut-down rate following successful union certifications tripled.

The Trump phenomenon didn’t just pop out of the woodwork in 2016. The material conditions for his campaign, as well as the more positive, promising campaign of Bernie Sanders, were laid years in advance. The role of "free trade agreements" like NAFTA in helping to create those conditions seems fairly evident to me. So, I will conclude by asking once again, who is really more responsible for Trump, NAFTA and trade agreements like it or "extreme progressives," who dared to shine a critical light on them, made principled calls for their revision and reform of the trade negotiation process going forward?

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Comments

janis b's picture

… who is really more responsible for Trump, NAFTA and trade agreements like it or "extreme progressives," who dared to shine a critical light on them, made principled calls for their revision and reform of the trade negotiation process going forward?

In so many ways america is in the dark for lack of ‘shining a critical light’. I would be happy to see more of the general population shining, if not a critical light, at least a more questioning and empathetic one.

What a sad reflection on the state of the culture and government, ‘cheap labour’ is.

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Radical Reformer's picture

@janis b Agreed, Janis.

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Meteor Man's picture

Because "extreme progressives" are non-existent in America. I'm guessing your friend considers Bernie and The Green Party "extreme progressives".

Ms. Holodnoy is a corporate "free market" propagandist on NAFTA and Public Citizen is correct. The Business Insider article you linked to references opinions from the WSJ and an economic advisor to Joe Biden. That's two strikes against her.

This statistic was curious:

Trade among the NAFTA partners increased from about $290 billion in 1993 to over $1 trillion by 2016, according to data cited by the Council on Foreign Relations.

And the Council on Foreign Relations?

Is that significant over a 23 year period if adjusted for inflation?

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15 users have voted.

"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn

janis b's picture

@Meteor Man

Is a third increase (if I’m calculating correctly) in 25 years significant.

Thought I’d better read something about the CFR …

But when The John Birch Society “… claims that the CFR is "Guilty of conspiring with others to build a one world government…”, I lose all rational perspective.

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Meteor Man's picture

@janis b
Now that's funny. I wonder what Alex Jones thinks about CFR? On second thought nevermind.

Since Henry Kissinger has strong connections to CFR, I'm guessing their real goal is a global "one world government under the USA".

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"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn

janis b's picture

@Meteor Man

Despite his exaggerated presentation I enjoyed this Alex Jones video …

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mimi's picture

@Meteor Man @Meteor Man
has a cruel way of thinking, like quite a lot of female political voices these days, not to name names of course.

To answer your question, imo it's NAFTA, because NAFTA is something defined and clear, "Extreme Progressive" is as clear as pudding.

And the Alex Jones video ... well, he speaks too fast. Why? Smile

Reading a little bit more about her, may be she is just a person, who knows too much. And by now we know who knows too much in this country. hmmm.

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snoopydawg's picture

extreme left revisionism," "ridiculous," "pointing blame indiscriminately."

If you don't like this reality say that it's not true. But don't actually say what is wrong with it. This is kinda like when we were kids and something was scary. We put our hands over our eyes and ears and pretended it wasn't real.

Yep again.

"extreme progressives for all intents and purposes helped usher 45 into office."

Trump is president today because of what Obama didn't do during his tenure. If he had kept half of his campaign promises Hillary would be president instead.

Bill Clinton's legacy has haunt us for two decades, just as Obama's legacy will haunt us for a long time ..

Good essay.

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America is a psyop wearing a cowboy hat

janis b's picture

@snoopydawg

We put our hands over our eyes and ears and pretended it wasn't real."

or like when children we hid behind a tree thinking, because we couldn't see anyone we also couldn't be seen.

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I'll never forget the first time I saw the sign in "progressive" California, on a fence along HWY 116 going west toward Sebastopol, it said "Will Work For Food" and a phone number. I totally plotzed, wtf is happening? (to the economy). That was 1995 already. William Jefferson Clinton, the lecherous precedent from hell, the giant sucking sound. He was from "Hope" Arkansas, and smoked weed once! Extra Bernays sauce, it never runs out. fuck

Now it is Bernie with the delusional sauce, making coin for his grandkids before he jumps off the hamster wheel. Feel the Bern, elect more Democrats. There is no accounting for propaganda, it's a major recruiting asset of the plutocracy, D-Scumbuckets are aiming at teenagers now, the most gullible group on earth. Demographics for the "win", voters can't tell a good D from a bad D to save their lives. I couldn't either. It only takes one vote and they're in forever, revolving through ever larger piles of cash. Moar Feinsteins.

D is for dead
good luck future

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k9disc's picture

@eyo

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“Tactics without strategy is the noise before defeat.” ~ Sun Tzu

dkmich's picture

Seriously, 2014? Efficient how and for whom? Throwing garbage into the ocean is efficient and makes money for corporations. Doesn’t make it good policy or strategy. Your friend is a neoliberal Republican. It is amazing how compartmentalized and short sighted they can be. Michigander here who watched what NAFTA did to our state and voted for Jill Stein in 2016. NAFTA is a disaster. NAFTA elected Trump. Trade is good. Good paying jobs even better.

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"Religion is what keeps the poor from murdering the rich."--Napoleon

*donate to c99 *like us on Facebook *follow us on Twitter

@dkmich @dkmich thanks, and jeez are we old or what? (shakes fist yells at sky)

Trade is good. Good paying jobs even better.

As the world burns.

Trump said to be reviewing Trans-Pacific Partnership in trade U-turn

During a meeting with Republican senators on Thursday, Trump reportedly asked Larry Kudlow, his national economic council chairman, and the US trade representative Robert Lighthizer to take another look at the pact – a deal he once called Republicans “stupid” for endorsing.

Larry Kudlow omg Edited to add: lol perfect! From the wiki: "In 1970, while he was still a Democrat,..."

Clinton Grants China MFN, Reversing Campaign Pledge

President Clinton Thursday reversed course on China and renewed its trade privileges despite what he said was Beijing's lack of significant progress on human rights.

Echoing the case made by George Bush when he was president, Clinton said he was convinced the Chinese would take more steps to improve human rights if the issue were separated from the threat of trade sanctions.

~shrug~
"Everything is a rich man's trick."

dump plutocracy
blah blah blah

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riverlover's picture

Local lexicon is Route 81, replacing 2-lane route 20. Lumber trucks going into Canada, Aluminum ingots inbound by truck and ship. They have to share a continent with us.

Rain on skylights makes me want to burrow under covers again. My main functions are down to eat and read and sleep.

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Hey! my dear friends or soon-to-be's, JtC could use the donations to keep this site functioning for those of us who can still see the life preserver or flotsam in the water.

The Aspie Corner's picture

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when one more believer tries to tell you that you are wrong for not reading the WSJ, Business Insider, Forbes, or whatever other corporate rag they've got their head shoved into today? One of my friends who most likely thinks that of me at least no longer bothers to try to argue that point, but she still reads all that garbage and spouts it out as well. I've already heard some of that "extreme leftist" shit being responsible for Trump but she isn't as blatant about it as your buddy is, she just goes silent and does not address the logic, which is the tactic of the entire MSM and the idiots who still think this is a Democracy and that impeaching Trump will make everything better. And those wars they all start? Why, those are Trump's fault too, impeach him and America becomes that decent, God fearing country it always was.... Head slap moment for sure.

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