US Presidential Contenders Spar on Trade As White House Continues TPP Push

10 March 2016

The trade positions of US presidential candidates are increasingly coming into the spotlight, as the primary process moves closer to indicating who may represent the Democratic and Republican parties for the upcoming November general election.

Meanwhile, the White House continues to push for ratification of a major Asia-Pacific trade deal by the US Congress this year, despite the electoral dynamics. Along with making a strong push for the pact in an annual report of presidential trade priorities, US President Barack Obama is slated to discuss this Trans-Pacific Partnership (TPP) with Canadian Prime Minister Justin Trudeau this week.

Sanders versus Clinton

On the Democratic side of the presidential contest, US Senator Bernie Sanders of Vermont and former Secretary of State Hillary Clinton argued openly on trade during a recent presidential debate, held on 6 March in Flint, Michigan.

Sanders and Clinton are the two remaining candidates in the Democratic race, with Clinton currently leading in the delegate count for the party’s nomination.

“Secretary Clinton supported virtually every one of the disastrous trade agreements written by corporate America,” said Sanders during last week’s debate, citing as examples the North American Free Trade Agreement (NAFTA) and securing permanent normal trade relations with China.

The Vermont senator specifically referred to the TPP – which was signed just last month – as an example where he and Clinton have differed in the past, and where he claims to have a longer track record in protecting US middle-class jobs.

“The reason that I was one of the first, not one of the last to be in opposition to the TPP is that American workers should not be forced to compete against people in Vietnam today making a minimum wage of US$0.65 an hour,” he said, in an apparent reference to Clinton’s comparatively more recent denunciation of the trade pact.

In response, the former Secretary of State referred to both her record as a former Senator for the state of New York, as well as her interest in knowing the content of the TPP before rendering judgment.

“To set the record straight, I voted against the only multinational trade agreement that came before me when I was in the Senate. It was called CAFTA,” said Clinton, referring to what is now the Dominican Republic-Central American Free Trade Agreement (CAFTA-DR), a deal between the US, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic.

“I came out against the TPP after it was finished. I thought it was reasonable to actually know what was in it before I opposed it. I oppose it,” she continued.

Clinton also countered that Sanders opposes the Export-Import Bank, the US’ official federal credit agency for exports. The Ex-Im Bank was re-authorised through 2019 last December, after its mandate lapsed in June. (See Bridges Weekly, 28 May 2015)

“Senator Sanders opposes that. I think we’re in a race for exports. I think China, Germany, everybody else supports their businesses,” said Clinton, referring specifically to the agency’s potential to assist small businesses’ capacity to engage in trade.

Sanders has cited his concerns over who receives Ex-Im Bank loans – which he claims primarily go to large corporations – as the reasoning behind his opposition.

Republicans at odds

The four remaining candidates in the Republican race – Senator Marco Rubio of Florida, Senator Ted Cruz of Texas, Governor John Kasich of Ohio, and real estate mogul Donald Trump – have all outlined to varying extents their positions on trade and the TPP.

“Both at the border, and with trade – and every other country we do business with we are getting absolutely crushed on trade,” said Trump during his party’s latest debate, held on 4 March in Detroit, Michigan.

“Every country we lose money with. As far as I’m concerned, we’ve got to reduce – we have to redo our trade deals 100 percent. I have the greatest business people in the world lined up to do it. We will make great trade deals,” he continued. The real estate giant cited in particular trade ties with China, Japan, and Mexico as areas needing significant improvement, and has in the past come out against TPP.

Kasich, by comparison, has openly backed the Pacific Rim trade pact, calling it “critical” for the US economy, particularly for building deeper inroads in that region and countering different trade approaches from China.

Cruz had previously said that he would wait until seeing the TPP deal before deciding whether to support it, and is now said to be against the pact. Rubio, for his part, said last year that he was in favour of the deal, a position which he has reportedly moved away from in recent months.

TPP tops White House trade policy agenda

Meanwhile, last week the Office of the US Trade Representative (USTR) confirmed that the Obama Administration will be actively pushing to get the Trans-Pacific Partnership Agreement ratified this year.

“Trade done right is essential for our economy here at home and for America’s position in the world,” said USTR Michael Froman in this year’s edition of the President’s Trade Policy Agenda, released on 2 March. “At the heart of this agenda is the Trans-Pacific Partnership.”

The President’s Trade Policy Agenda is an annual document which outlines the US executive branch’s priorities for the coming year. The 2016 edition runs at over 60 pages, divided into three main sections: one on the Trans-Pacific Partnership, the second on other US trade priorities, and the last on the White House’s accomplishments during Obama’s tenure.

Along with outlining the deal’s potential benefits in areas such as automobile manufacturing, agriculture, the environment, and national security, among various others, the report highlights the importance of such a trade pact for US leadership and diplomacy, with quotes from top US defence officials and leaders from fellow TPP countries.

“It is not in the national interest to sit on the sidelines and let others define the rules of the road without us,” said Froman.

The report also touts other trade initiatives, such as the negotiations with the EU for a Transatlantic Trade and Investment Partnership (TTIP); talks with over 20 fellow WTO members for a Trade in Services Agreement (TISA); and a plurilateral effort to clinch an Environmental Goods Agreement with 16 other WTO partners.

For the US-EU deal, the report states that the President is aiming to reach an “ambitious, comprehensive, and high-standard TTIP agreement in 2016” – a statement in line with the sentiment expressed by negotiators from both sides after the latest round of talks. (See Bridges Weekly, 3 March 2016)

Last month doubts had emerged over whether the White House was indeed operating on such a timeline, following comments by an Administration official on the subject which indicated that the talks could drag on into next year. (See Bridges Weekly, 11 February 2016)

The report also calls for an “ambitious conclusion” to the TISA negotiations this year. (See Bridges Weekly, 3 March 2016)

ICTSD reporting; “Transcript of the Democratic Presidential Debate in Flint, Mich.,” THE NEW YORK TIMES, 6 March 2016; “Donald Trump: Here’s the one area where Bernie Sanders and I agree,” BUSINESS INSIDER UK, 7 February 2016; “Transcript of the Republican Presidential Debate in Detroit,” THE NEW YORK TIMES, 4 March 2016; “What the Candidates Are Saying About Free Trade in the Debates,” HUFFINGTON POST, 16 February 2016; “What should worry Clinton about Sanders’s Michigan win,” WASHINGTON POST, 9 March 2016; “Marco Rubio Advocates Pacific Trade Deal As A Tool To Force China To Stop Economic Manipulation,” REAL CLEAR POLITICS, 28 August 2015.

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