Rubin gave Dean the word. But he doesn't get it. And the WSJ gives Clinton the credit that is due.
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Trading Places
Dems ditch Bill Clinton's legacy for Herbert Hoover's.
Sunday, September 28, 2003 12:01 a.m.
Howard Dean recently told the Washington Post that former Democratic Treasury Secretary Robert Rubin had advised him he couldn't "sell" Dr. Dean to Wall Street if he didn't become more of a free-trader. Dr. Dean declared this almost as a badge of honor, which illustrates a dangerous economic turn in the race for the Democratic Presidential nomination.
We had our differences with Bill Clinton, but there's no doubt one of his achievements was leading his party away from protectionism. Open trade was a pillar of his New Democrat philosophy. He and Al Gore routed the AFL-CIO and Ross Perot to pass Nafta in 1993, followed by bills to create the World Trade Organization and allow most-favored-nation trading status for China. A decade later all three have contributed to American prosperity.
But without a Democrat looking out for the national interest from the Oval Office, the party is now slipping back toward trade parochialism. On Capitol Hill, the party's regional and union interests have become dominant; most Democrats opposed giving President Bush new trade negotiating authority last year. More ominous still is the rhetoric coming from the Presidential candidates.
In demanding that Nafta be renegotiated, Dr. Dean is hardly alone. With the exception of Senator Joe Lieberman, we can't find any of the other candidates who still supports it. John Kerry attacked Dr. Dean as a protectionist the other day, but the Massachusetts Senator has also said he regrets having voted for Nafta. Dr. Dean is also getting whacked from the left for not being protectionist enough: Congressman Dick Gephardt has mocked the fact that Dr. Dean sent Bill Clinton a letter supporting it and showed up for the signing ceremony in 1993, only to walk away from it now.
Meanwhile, Senator John Edwards is sending out weekly news releases trying to pick a trade fight with China. Even Mr. Lieberman, a recognized free-trader, is trying to show he can also be "tough" on trade by joining the Bush Administration in knocking China around.
The Democrats insist they don't oppose free trade but only that any new trade agreements must have "labor and environmental standards" written into them. Dr. Dean has told several interviewers that he would withdraw from the World Trade Organization and Nafta if they weren't altered to ensure that foreign workers have "the same labor laws and labor standards and environmental standards" as the U.S.
But this is a recipe for precisely the kind of U.S. unilateralism they claim to deplore in the Bush Administration. Not many other countries are pleased to import another country's labor laws. Poor countries with low wages especially resent the forced imposition of U.S. rules that assume a far higher standard of living.
As Mr. Lieberman noted in this month's Albuquerque debate, "That would mean we'd break our trade agreements with Mexico, with Latin America, and with most of the rest of the world. That would cost us millions of jobs. One out of every five jobs in America is tied up with trade. So if that ever happened, I'd say that the Bush recession would be followed by the Dean Depression." Dr. Dean tried to backtrack that he'd accept "international" standards as well, but his protectionist bent is clear.
It may be that some of this is due to the free-for-all that the Democratic race has become. The candidates are looking for any edge, and in particular they covet the early endorsement of the AFL-CIO that helped Al Gore beat Bill Bradley in 2000. Union members are a huge share of the nominating electorate, especially in Iowa, where Dr. Dean hopes to knock Mr. Gephardt out of the race.
And yet promises made during a campaign are hard to break. Mr. Bush's trade record is less than sterling, with its steel tariffs and the recent collapse of global talks in Cancun. So trade would be one issue where the Democratic nominee could campaign as the more pro-growth candidate who supports American global economic leadership.
Instead, the Democrats are falling for the fool's gold of protectionist politics. The polls always look at first glance as if bashing foreigners on trade is popular. But campaign history is littered with politicians who have tried it and been rejected. No major American political party has nominated an avowed protectionist since Herbert Hoover in 1928--and we know how that turned out.
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