Trade to Clinton

GEORGE BUSH may have hoped to leave office with a couple of completed free-trade agreements among his laurels, but that is not likely to happen. The president may sign the North American Free Trade Agreement (NAFTA), but that will only initiate a long and prickly ratification process in Congress. The broader Uruguay Round of the General Agreement on Tariffs and Trade (GATT) appeared to get a boost from last month's resolution of an agriculture dispute between the United States and the European Community,

but other hurdles remain.

Both these pacts will end up in the lap of incoming President Clinton. They will be major tests of his ability to give practical expression to his vision of merging economic policy and foreign policy, and of his ability to rally the support of fellow Democrats in Congress. Democrats with ties to labor, manufacturing, and the environmental movement are vocal critics of NAFTA, in particular.

Recommended: Default

Mr. Clinton has identified himself as a free trader, with reservations. Business and labor interests that feel threatened by the trade agreements will do their best to expand his reservations. The entertainment industry wants to see Europe's restrictions on the import of American TV shows and films come down before GATT is approved. Some high-tech firms are concerned about patent infringements on their chip designs. Financial-service companies have their qualms.

Negotiators will be able to tidy up many of these loose ends, but a final draft of the GATT pact won't be able to satisfy everyone. Approval will hinge on the abilities of national leaders, Clinton foremost, to highlight the benefits of expanded trade.

Though he has tiptoed through the politically thorny trade issue, Clinton recognizes its importance. On NAFTA, he'll have an especially difficult selling job. Anti-NAFTA Democrats in Congress are at work planning their attack. Their fire will concentrate on the flow of jobs into Mexico's low-wage labor market and inequities between US and Mexican environmental regulations.

These concerns warrant further discussion, and Clinton's proposal to pursue parallel talks with Mexico to resolve them makes sense. Those who want to reopen the main talks are angling to kill the deal altogether.

In the end, both GATT and NAFTA could be strengthened by having the new administration in Washington hammer out final details. The Clinton team will then be enforcing agreements it had a hand in shaping. When the work is finally done and businesses start taking advantage of new opportunities, it will be a feather in the cap of both administrations.

Share this story:

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...