[Mb-civic] Bush, Kerry Are Worlds Apart on Trade Issues

[Michael Butler]

http://www.latimes.com/business/la-fi-trade15aug15.story

Bush, Kerry Are Worlds Apart on Trade Issues

Senator speaks out for workers, environment. President's aides warn against
protectionism.
 By Evelyn Iritani
 Times Staff Writer

 August 15, 2004

 By the time President Clinton left the White House, he had signed 200 trade
agreements and earned a reputation as a persuasive advocate for tearing down
barriers and opening markets across the globe.

 But days before a tension-filled 1999 meeting of the World Trade
Organization in Seattle, Clinton declared that trade pacts should include
tough provisions to protect workers and the environment. Officials from
developing countries were furious, convinced the U.S. was simply trying to
keep their products out of its markets. The meeting collapsed in acrimony.

 When it comes to concern for how trade affects laborers and the
environment, John Kerry could turn out to be Bill Clinton on steroids.

 The Democratic presidential nominee maintains that the U.S. has not done
nearly enough to ensure that expanded trade hasn't come at the expense of
workers' rights or clean air and water. And he suggests that when companies
from other nations commit abuses in these areas ‹ forcing laborers to work
in oppressive conditions or allowing factories to spew pollutants ‹ it is
both unconscionable and unfair, giving them a leg up against U.S. firms that
must comply with strict regulations.

 "You can't have trade be a rush to the bottom," Kerry declared early in his
campaign.

 Bush administration officials, warning that Kerry's stance could kill
future trade deals, have branded the Democrats "economic isolationists."

 If Kerry is elected, the U.S. is likely to pursue a "more protectionist
approach," leading to "less openness of markets, fewer new trade agreements
and more use of trade as a stick rather than a carrot," warned Michael
Franc, director of government relations at the conservative Heritage
Foundation in Washington.

 Though it hasn't received much attention, trade is turning out to be an
arena in which Kerry and Bush have staked out sharply divergent views ‹ with
potentially enormous consequences.

 Whoever wins the White House in November will have a full battery of trade
issues to contend with. At the top of the list is the Central American Free
Trade Agreement, known as CAFTA, which awaits approval by Congress. Also on
the front burner is a deal to create the Free Trade Area of the Americas, or
FTAA, a free-trade zone that would extend from Alaska to the tip of South
America.

 Going forward with the FTAA, said Progressive Policy Institute analyst
Edward Gresser, promises to spark the "same sort of division and emotional
debate" that the politically divisive North American Free Trade Agreement
generated 10 years ago. The institute, a Democratic think tank in
Washington, is advising the Kerry campaign.

 And still there's more. Global trade talks aimed at further reducing
barriers for agricultural goods, industrial products and services are slated
to be completed next year. Under pressure from developing countries, the
U.S. and other World Trade Organization members agreed this month to cut or
eliminate billions of dollars in farm subsidies as a condition for reviving
the stalled talks.

 At the end of this year, meanwhile, global textile and apparel quotas are
set to expire, possibly displacing millions of workers worldwide.
Manufacturers in the U.S. and poor countries have formed an unusual alliance
seeking to delay the quota phaseout, asserting that it will allow China's
low-cost factories to dominate world markets while causing potentially
explosive instability in countries such as Egypt and Turkey.

 The U.S. trade deficit also continues to mount. On Friday, the government
reported that the deficit widened much more than expected in June, hitting a
record $55.8 billion on record imports and the biggest drop in exports in
nearly three years.

 With so much at stake, it's not surprising that the Bush and Kerry camps
have been quick to tout their candidates' trade credentials.

 "I really don't see how our trade agenda could be viewed as anything but a
success," said Richard Mills, a spokesman for the U.S. trade
representative's office. "Bottom line, we've expanded U.S. export
opportunities and leveled the playing field."

 When President Bush took office, Mills points out, the U.S. had negotiated
free-trade agreements with just four countries. Since then, U.S. officials
have completed free-trade pacts with 12 countries, including Singapore,
Chile and Australia.

 At the same time, Bush backers accuse Kerry of flip-flopping on trade to
placate unions and environmentalists, two key constituencies for a Democrat
in an election year.

 They note that the Massachusetts senator voted for NAFTA in 1994 ‹ and yet
now contends that a provision in the agreement aimed at protecting the
assets of foreign investors has made it too easy for firms to challenge U.S.
environmental rules.

 Kerry aides reject the notion that the senator has vacillated, saying that
he has simply seen more and more evidence of the downside of globalization.

 "We know a lot more today than we did a decade ago about what works and
what doesn't," said Jason Furman, a Kerry economic advisor and former
Clinton administration official.

 It's not just NAFTA that concerns Kerry. He also has said he wouldn't sign
off on CAFTA or FTAA unless they are renegotiated to include tougher
environmental and labor provisions. Both agreements are strongly supported
by Bush.

 China has emerged as a point of contention too.

 Kerry has accused Bush of not being stern enough with Beijing, even though
the administration filed the first World Trade Organization complaint
against China (in a semiconductor dispute this year) and levied punitive
duties on three categories of Chinese-made apparel and textiles.

 The Democrat has said he would consider filing additional complaints with
the WTO ‹ which are supported by organized labor and American manufacturers
‹ that accuse China of boosting exports by keeping its currency artificially
weak and failing to enforce labor laws. The Bush administration opposes
these moves.

 The Bush administration has filed 12 WTO challenges since it has come into
office. That contrasts with an average of 11 per year during the Clinton
administration.

 Still, Bush has hardly been a purist when it comes to advocating free
trade.

 The administration imposed steep tariffs on imported steel and signed a
farm bill whose multibillion-dollar subsidies and other supports triggered
indignation among poor nations. Bush also has been criticized for limiting
Iraqi reconstruction pacts to countries that supported the U.S.-led war
there.

 Yet for all their inconsistencies, many believe that the incumbent's and
the challenger's respective positions on trade are rather stark in the end.

 "Sen. Kerry appears to go down the path of looking for fair trade as
opposed to free trade, and President Bush appears to favor free trade with
less concern for fair trade," said Jim Horvath, president and chief
executive of American Crystal Sugar Co. The large Minnesota-based sugar beet
cooperative opposes CAFTA because its members believe that the agreement
will force them to compete against heavily subsidized producers.

 Horvath voted for Bush in 2000. This time, he's undecided.


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