What Clinton Said About Trade on Monday

On Monday Clinton laid out her program for rebuilding the middle class in the U.S.: Rebuilding the Middle Class: Hillary Clinton's Economic Blueprint for the 21st Century.  Trade measures play a role in this.

The speech took place at the start of a campaign tour through Iowa.  About two thirds of the way through the speech she got to trade.  She said she'd do the following:

• include enforceable protections for labor and environmental standards (It's unclear whether this only refers to future agreements, or to renegotiation of existing agreements.  Does it go beyond the Spring agreement between the Administration and Congress?)
• Appoint a Trade Enforcement Officer in the USTR office, and double the budget for enforcement of trade agreements (here's the USTR website on Monitoring and enforcement)
• Review all trade agreements every five years and "make adjustments" (sounds unilateral, but maybe it could be interpreted as renegotiating, or negotiating supplemental agreements, clarifying letters, or memoranda of understanding) starting with NAFTA
• Increase budget, coverage and efficacy of trade adjustment assistance.  Her health plan would also relieve persons displaced by trade
• reduce the Federal budget deficit

Here it is in her words:

And I will work from day one to ensure that our trade policies actually work for American workers. That they include strong enforceable protections for labor and environmental standards, and that they deliver benefits not just for trading partners, not just for the people at the top of the income scale in America, but for all Americans.

Because look at what has happened in the past six years. Our trade deficit has doubled in just six years to $760 billion a year. The Economic Policy Institute estimates that we've lost 1.8 million jobs to China, we're paying higher prices for low cost consumer goods some of which have serious safety problems. Now the last 6 years may have been great for China, but is it the best course for America going forward? I don't think so.

It's time for a new approach, one that doesn't lead to a race to the bottom, but instead ensures that ordinary citizens not CEO's but people who do the work in America and in other nations come out ahead again.

I will start by appointing a Trade Enforcement Officer within the United States Trade Representative's Office who will be responsible for vigorously enforcing trade agreements. And I will double the size of the enforcement unit. The Bush Administration has filed roughly the same number of enforcement actions under our trade agreements that were filed during one year of the Clinton Administration. That is unacceptable. They're abdicating their responsibility, no one should get away with violating trade agreements, and when I'm President, we're going to start enforcing them again and we're not going to enter into them unless we think they're going to be good for American workers.

Next I will work to address specific problems with NAFTA. As I've said before, this agreement has some serious shortcomings. For example, I did a study last year in New York looking at the impact of NAFTA on our business people, our workers and our farmers because we share a long boarder with Canada. But what people were telling me whom I represent is they could not get their products into Canada despite NAFTA's promise of equal access. And I did a study and I sent it to the Bush Administration and I said I want answers as to why this is not working. You know I have apple farmers up along the boarder, they couldn't get their apples in but apples were coming out of Canada. I had business people who couldn't figure out how to get through all of the red tape to get their products in, but products were coming out of Canada. Now we have a great relationship with Canada. But I think it is time that we assess trade agreements every five years to make sure they're meeting their goals or make adjustments if they are not and we should start with doing that with NAFTA.

And finally, I will overhaul our Trade Adjustment Assistance Program to ensure that workers who've lost their jobs because of global competition get the income support, the health care, the job training and the job placement assistance they need to get back on their feet.

You know the Trade Adjustment Assistance Program is a lifeline for workers across America who can use it. Unfortunately too few people can use it. First, service workers whose jobs are lost to outsourcing should be able to be eligible to receive TAA benefits. It makes no sense to keep excluding service workers because we know we're losing a lot of service jobs overseas. Second, TAA should cover all workers whose plants have moved abroad whether or not the plant moved to a country with which we have a free trade agreement. Believe it or not, Trade Adjustment Assistance currently does not cover workers whose jobs are outsourced to China and India because we don't have free trade agreements with them.

I want to double the funding for the job training program under TAA to $440 million a year and increase TAA tax credits to help displaced workers pay for health insurance. Now ultimately under my American Health Choices Plan, workers will be able to buy into the Federal Employees Health Benefits Plan, the same program that insures members of Congress.

Later, her commitment to address the Federal budget deficit is also relevant to trade, although not for the reasons she gives:

So when people ask me, why is it so hard to get tough on China and other trading partners, I tell them because they've been turned into our bankers. We owe them. How can we truly enforce trade laws against a country like China whose manipulated currency puts us at unfair disadvantage, but our economic stability depends on them continuing to provide massive loans to us every single month?

I want America back in control of our fiscal destiny. It may take a few years but we have to move back toward a balanced budget and a surplus. We have to find a way both to increase long-term investment and to stop borrowing money from other countries for current consumption, whether it's for our soldiers in the field or for tax cuts for millionaires. We have to develop a set of budget rules similar to those we had in the 90s that required us to fund new expenditures with new revenues or cut spending.

Reducing the deficit should increase domestic saving, reduce overseas investment flows to the U.S., and reduce the trade deficit.

Minor editorial changes Oct 21, 2007.

Comments

[Peter Gallagher]

The most important measure here (IF she means it) is moving to stronger fiscal discipline. Of course, Presidential candidates say that all the time and then play the game with Congress as soon as they're in the seat. Otherwise, as long-term foreign observer of US trade "rhetoric" -- i.e. the things politicians say to their home constituencies -- I'd say this looks relatively moderate. Of course, the 'enforcement' of labor standards (whose?) is potentially a shabby refuge for protectionism. But there's nothing in Clinton's approach to this that threatens more than the Democrats in Congress have already agreed, which seems to allow for differentiation. Doubling TAA is may be a good idea, too. If it works (I've never been sure what it actually DOES). What consumers in the US and producers abroad don't want above all is a return to the knee-jerk (or cynical -- take your pick) use of safeguard actions to 'protect jobs' such as those in the early days of the Bush Administration. One thing to be said in Mrs Clinton's favor here seems to be that, unlike Mr Bush in his first term, she doesn't have as much need to 'learn on the job'.

[r4]

Obama should have chosen Clinton if it’s really for the good of America, both of them would have given up their differences and tried to work out all the issues by employing Obama’s vision and Clinton’s experience. The fact that Obama chose Biden simply because this guys has the cleanest history and less problems for Republican’s attack shows how egoistic Obama is and what he’s really in for - to win the race, not for the good of America. Clinton is so much more brilliant and capable than Biden. What a poor choice on Obama’s part to choose Biden as a running mate. He just lost my vote for this election.