NAFTA

In the run-up to the Ohio (and Texas primaries) we hear Hillary Clinton and Barrack Obama trip over each other to condemn NAFTA. Both, of course, are demagoguing the globalization issue in states in which smokestack industry is slowly fading.

Obama tries hard to paint Clinton as pro-NAFTA and has eroded her lead in Ohio, but Canada’s CTV reports that a senior Obama aide told Michael Wilson, Canada's ambassador to the United States, that Obama would speak out against NAFTA, but that “the criticisms would only be campaign rhetoric, and should not be taken at face value.”

Hmmm. Is that just a little political cynicism from the candidate of hope and change?

Like many of the issues raised by Barack Obama, his rhetorical skills make his presentation seem compelling, until you look at the facts. Steve Chapman considers the reality of NAFTA:

Obama makes a special theme of blaming this and other trade agreements for setting off a race to the bottom that destroys American jobs. "In Youngstown, Ohio," he said in a Texas debate, "I've talked to workers who have seen their plants shipped overseas as a consequence of bad trade deals like NAFTA, literally seeing equipment unbolted from the floors of factories and shipped to China." Why NAFTA would induce a company to move production to China is a puzzle, but you get the idea.

His campaign claims a million jobs have vanished because of the deal. That sounds devastating, but over the last 14 years, the American economy has added a net total of 25 million jobs -- some of them, incidentally, attributable to expanded trade with Mexico. When NAFTA took effect in 1994, the unemployment rate was 6.7 percent. Today it's 4.9 percent.

But maybe all the jobs we lost were good ones and all the new ones are minimum-wage positions sweeping out abandoned factories? Actually, no. According to data compiled by Harvard economist Robert Z. Lawrence, the average blue-collar worker's wages and benefits, adjusted for inflation, have risen by 11 percent under NAFTA. Instead of driving pay scales down, it appears to have pulled them up.

Manufacturing employment has declined, but not because we're producing less: Manufacturing output has not only expanded, but has expanded far faster than it did in the decade before NAFTA. The problem is that as productivity rises, we can make more stuff with fewer people. That's not a bad thing. In fact, it's essentially the definition of economic progress.

The conventional wisdom is that Barack Obama will win the Democratic nomination and then handily beat John McCain, riding a wave created by those who are moved by his messianic message of hope and change.

But that message may begin to come apart as the electorate probes his policy positions and finds that there may not be much there. It’s important to remember that Hillary was "inevitable" 8 months ago. Some think Obama is the inevitable President today, 8 months before the general election. Eight months is a long time. Just ask Mrs. Clinton.