Thursday, February 19, 2009

Don't Blame the Current Economic Conditions: Obama's Softer Position on NAFTA Emerged Almost a Year Ago

As the Democratic primaries reached the nation's Rust Belt, both Hillary Clinton and Barack Obama began making harsh critiques of NAFTA, and they vowed to renegotiate the trade pact, even if this required pulling out of the agreement. Today, however, during a joint-press conference with Canadian Prime Minister Stephen Harper, Obama took a much softer tone regarding NAFTA and stated that he wanted to expand rather than reduce trade activity between the U.S. and Canada.

President Obama attributed his markedly different stance towards NAFTA to the global economic crisis. Specifically, he said that in the wake of the global recession, he needed "to be very careful about any signals of protectionism." He made similar statements earlier this week. Obama's softer stance on NAFTA, however, began as almost a year ago.

Obama's March 2008 NAFTA "Wink"
In March 2008, during the heat of the Democratic candidates' assault on NAFTA, a leaked memorandum of notes describing a meeting between Canadian Consul General Georges Rioux and Obama's economic policy advisor Austan Goolsbee created created a political firestorm. The leaked notes stated that Goolsbee tried to reassure Canadians that Obama's tough position on NAFTA was merely "political positioning" and that he was fully committed to free trade with Canada.

The leak of the memorandum triggered a response from Obama's campaign, which said that the notes distorted discussions between Goolsbee and Rioux. Although Goolsbee denied using the words "political positioning," he did not deny saying something similar.

Full Retreat on NAFTA By June 2008
As soon as Obama obtained the Democratic nomination, his rhetoric on NAFTA dramatically shifted. And just as the leaked memorandum indicated, he began to pull away from the harsh anti-trade rhetoric that defined the Democratic primaries in the Midwest.

During a June 2008 interview with Fortune magazine, for example, Obama said that he would not seek a unilateral renegotiation of NAFTA, even though both he and Clinton had vowed to do so earlier. When asked by Fortune to reconcile his softer position with his forceful campaign rhetoric, Obama stated that "[s]ometimes during campaigns the rhetoric gets overheated and amplified. . . . Politicians are always guilty of that, and I don't exempt myself."

Last Word: I agree that protectionism will not solve the country's economic problems, and it could even exacerbate them. And I never really expected Clinton or Obama to modify substantially the terms of NAFTA. But Obama's current pro-NAFTA position did not recently take hold. Instead, as soon as he secured the Democratic nomination, he began moving to the center on free trade, which confirms the content of the leaked memorandum.

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