NAFTA @20: The Perils of Partisanship
In his December 8, 1993, remarks at the signing of the North American Free Trade Agreement (NAFTA), then-U.S. President Bill Clinton observed that the treaty debate had become a “symbolic struggle for the spirit of our country and for how we would approach this very difficult and rapidly changing world dealing with our own considerable challenges here at home.”
Yet, just as fundamentally, NAFTA was a defining moment for the Clinton presidency itself, and a shining example of the kind of bipartisan unity that eludes the United States today—which is why, looking back on the prosperity, stability and growth that NAFTA helped to achieve, I find myself yearning for the kind of enlightened leadership that made it possible in the first place.
Negotiated under President George H.W. Bush, NAFTA was the most comprehensive trade agreement of its time, creating a single market that stretched from the Yukon to the Yucatán. Though promoting free trade had traditionally been seen as a Big Business (read: Republican) cause, Clinton supported the agreement as well, albeit with some modifications.
Unfortunately, by the time the administration’s effort to secure the treaty kicked into high gear in the late summer of 1993, vocal opponents—including Ross Perot and his acolytes, America First-ers, unions, and environmental groups—dominated the debate. As a Businessweek article that spring lamented, “NAFTA isn’t out, but it sure is down.”1
The president dispatched U.S. Trade Representative Mickey Kantor to secure side agreements with Mexico and Canada that addressed labor and environmental concerns. Meanwhile, he appointed political veteran William P. Daley to run the NAFTA “war room,” building support for the highly contested vote in the U.S. House of Representatives. Minority Whip Newt Gingrich had pledged to deliver Republican votes, but only if Clinton could bring 100 Democrats along. Given the pressure from labor unions, this would be an uphill fight within our party.
As White House Chief of Staff, I recruited key Republican strategists, including Ken Duberstein, Nick Calio, Billy Pitts, and Wayne Berman, to lend advice and assist with outreach; we knew that bipartisan engagement would be indispensable for success. As Berman later told TIME magazine reporter Michael Duffy, “It is a measure of how much the world and rules have changed when Republicans pitch in to help Bill Clinton realize George Bush’s legacy.”2
On September 15, Clinton signed the new side agreements in the presence of Presidents Gerald Ford, Jimmy Carter and George H. W. Bush, all of whom spoke favorably and forcefully about the agreement—a bipartisan bully pulpit grand slam. Even more compelling was the televised November 10 debate between Vice President Al Gore and Ross Perot. Until that point, Perot had been among NAFTA’s most effective critics; his quip about the “giant sucking sound” of U.S. jobs fleeing south hit home among many Americans who feared what the treaty would mean for their economic futures. But Perot’s angry debate performance alienated viewers. Support for NAFTA jumped from 34 percent before the debate to 57 percent after.3
Still, the treaty’s passage was not guaranteed. Right down to the wire, lobbyists and members of Congress from key sugar-producing states were pushing for a so-called “sugar fix,” a side deal to protect the U.S. sugar industry from any sudden surges of sugar imports from Mexico. And Mexico, under President Carlos Salinas, showed great courage and flexibility in going the extra mile to secure a deal just days before the House voted.
In the end, the powerful combination of presidential leadership and bipartisan cooperation prevailed. The run-up to the November 17, 1993, House vote is the only time I can remember Newt Gingrich and George Stephanopoulos counting votes in the Roosevelt Room together.
And two decades later, the value of the North American idea is undeniable. Total trade between the U.S., Canada and Mexico has tripled to well over a trillion dollars, supporting nearly 14 million good U.S. jobs. Canada and Mexico are our top two export markets, purchasing nearly one out of every three dollars of U.S. goods and services abroad. Our North American neighbors are our second- and third-biggest import suppliers, providing U.S. consumers with greater choice and lower prices.
Just as important is the stabilizing effect NAFTA had on a Mexico in transition. The agreement reinforced Mexico’s commitment to looking outward and to solidifying its institutions and democracy. When the 1994 peso crisis struck, Clinton rose to the challenge once again, providing a $20 billion recovery package through the power of executive order. Under the principled, bold leadership of President Ernesto Zedillo, Mexico repaid the loan in full and ahead of schedule.
And despite lingering challenges, today’s Mexico is on a promising path of progress, with a dynamic economy, stable democracy and productivity at an all-time high.4 President Enrique Peña Nieto has shown real commitment to continued reform.
Crucially, NAFTA has made real our three nations’ interdependence and potential for mutual benefit. We are invested in one another’s success as never before. Many of our manufactured goods are co-created, crossing the borders back and forth multiple times throughout the production process. U.S. imports from our NAFTA partners are between 25 and 40 percent of U.S. origin. Consequently, as scholar Christopher E. Wilson has argued, “Trade between the United States and Mexico, as well as with Canada, is of a qualitatively different nature than trade with any other country in the world”5—and each of our nations stands to gain as the others grow and prosper.
Regrettably, over the past decade, the impetus for North American integration has stalled. First came 9/11 and the ensuing diversion of focus and resources to the wars in Iraq and Afghanistan, as well as the emphasis on tightening security at the borders. Add to that China’s rise as an economic powerhouse, the U.S.’s rebalancing toward Asia and the recession. Little energy seemed to remain for realizing NAFTA’s fullest potential.
As Mexican ambassador to the U.S. Eduardo Medina Mora has said, our nations are currently engaged in twenty-first-century trade that relies on twentieth-century regulations and nineteenth-century infrastructure.
Among the three NAFTA countries, only Mexico’s foreign ministry has a bureau of North American affairs. U.S. officials have too often approached North American issues bilaterally instead of trilaterally, for example with separate Trusted Traveler programs for visitors from Canada and Mexico, and separate northern and southern Congressional caucuses championing their respective border interests.
And we’re missing opportunities to leverage our collective weight on the global stage. Canada and Mexico were only belatedly invited into negotiations on a Trans-Pacific Partnership, depriving us of the opportunity to align our positions vis-à-vis Asian trading partners and competitors.
The problem is not a lack of ideas about how to promote integration; on the contrary, numerous scholars, think-tanks and others have put forward a host of options to bolster our collective competitiveness, from harmonizing regulations and safety standards to improving transportation and infrastructure, establishing a common external tariff, opening the U.S. health care market to Mexican service providers, and more.
What is lacking today in the U.S. is the bipartisan political will to make any of these issues a priority. The gridlocked, hyper-partisan climate that characterizes Washington makes it hard to imagine significant progress on any issue not in full-blown crisis.
A ray of hope exists, however, in the form of North American citizens themselves.
According to a recent cross-border survey conducted by a trilateral trio of scholars—Robert Pastor, Miguel Basañez and Frank Graves—North American publics prioritize continental integration more enthusiastically than do their governments. Our peoples are especially interested in closer cooperation regarding environmental and border issues; and they are less concerned about any loss of national sovereignty than they are about losing economic ground.
Speaking in Mexico City in September 2013, Vice President Joe Biden described a “North American [economic] engine gaining more power, more steam and more capacity,” and added, “To those of you here from outside of government, we have been convinced of your message; now make us do it.”
Twenty years ago, presidential leadership, across two administrations of both parties, was the force behind NAFTA’s passage. Now, it seems that public activism will be needed to achieve NAFTA’s promise.