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Trade Emerges as Big Campaign Issue

RENEE MONTAGNE, host:

Back now to the race for the Democratic presidential nomination, where a 14-year-old trade deal has emerged as one of the big issues.

(Soundbite of audio)

Senator HILLARY CLINTON (Democrat, New York): We need to have a plan to fix NAFTA. I would immediately have a trade time-out.

Senator BARACK OBAMA (Democrat, Illinois): We have to stop providing tax breaks for companies that are shipping jobs overseas and give those tax breaks to companies that are investing here in the United States of America.

MONTAGNE: Senators Barack Obama and Hillary Clinton debating last night in Cleveland.

And for some analysis on where the candidates stand on trade and what difference it makes, we've called David Wessel. He's economic editor of the Wall Street Journal and a regular guest on this program.

Good morning.

Mr. DAVID WESSEL (Economic editor, Wall Street Journal): Good morning.

MONTAGNE: Now, as I just said a moment ago, the free trade agreement NAFTA has been around for 14 years. Why the heat just now in this campaign?

Mr. WESSEL: Well, I don't think it's actually about NAFTA. Even if Senator Obama or Senator Clinton were elected president, actually reopening NAFTA - if they actually succeeded in doing that - would probably make very little difference to any of the workers in Ohio who are so worried about trade.

I think what we see here is a widespread view among many Americans that all the problems of the last several years - lack luster wage growth and all this stuff, their job insecurity - is due to trade. They're probably not right, but they think that trade is the only cause, it's one of them, and the candidates are responding to that.

MONTAGNE: Now, David, before these recent campaign skirmishes was there an obvious difference on trade between the two Democratic candidates?

Mr. WESSEL: Not really. It's very hard to tell their positions in the Senate apart, both were in favor of a recent trade deal with Peru. Both were against one with Central America. Both are very strongly opposed to a South Korean free trade deal that President Bush has negotiated. Both voted to whack China for keeping its currency weak.

You had that clip of Senator Obama talking about using the tax code to reward companies that keep jobs in the U.S. Actually, Senator Clintons in favor of that, too. It was a plan that Senator Kerry proposed during his presidential campaign a while back.

When you talk to people who are around the Bush White House, they say that Mrs. Clinton was a loyal soldier, but never very enthusiastic about NAFTA. When you read Senator Obama's book you find him sounding an awful lot like Bill Clinton, praising the virtues of globalization and proposing to protect workers from it but not to build walls.

So I think a lot of this is what you get when you run for president in Ohio.

MONTAGNE: And on the Republican side, John McCain's stance on trade, how different is it from the Democrats?

Mr. WESSEL: Well, it's very different. Once we get beyond this Democratic fight and we have a race between a Democrat and Senator McCain there will be a clear difference. There won't be arguing about nuance.

Senator McCain is a Republican senator from Arizona, has been a steady supporter of every free trade pact. He's in favor of the Korea pact.

And what's actually interesting to me is that in both parties the candidates most hostile to trade have actually been trounced, whether it was Governor Huckabee on the Republican side or Senator Edwards on the Democratic side.

But once the real general gets going we're going to have a trade skeptic running against a free trader.

MONTAGNE: Well, just very briefly, a lot of tough talk by the Democrats during this campaign. what is the likelihood of big change even if a Democrat is elected?

Mr. WESSEL: I don't think NAFTA will be reopened and renegotiated. And even if it does it won't make much difference. But I think we're at a point where it'll be very difficult for any president, whether President McCain, Obama or Clinton, to push a series of free trade pacts through Congress without some kind of what Hillary Clinton calls a time-out to fix the problems that seem to be motivating so many voters to be skeptical of trade. Things like healthcare, job security, pensions and wages.

MONTAGNE: David, thanks very much.

Mr. WESSEL: A pleasure.

MONTAGNE: David Wessel is economic editor of the Wall Street Journal. And you are listening to MORNING EDITION from NPR News. This is NPR News. Transcript provided by NPR, Copyright NPR.

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