By Harold Pease, Ph. D
Much of why Donald Trump is president is because of the North American Free Trade Agreement (NAFTA), which always has been disastrous for the trades. Democratically controlled unions and their politicians were for it when signed into law by President Bill Clinton and without union support it would not be law.
Big corporations and globalists (often Republicans) have been for it because through it they could manage the regulations and productions codes thus keeping their monopolistic empires in place—it limited trade. It has never been free trade. Free trade is the absence of production codes, government regulations, and trade boundaries, when the consumer alone picks the winners and losers by the high quality and low cost of their performance or products.
Many union workers knew their party had betrayed them at the time but almost all know it now. When Trump dubbed NAFTA as “the worst trade deal maybe ever signed anywhere, but certainly ever signed in this country,” they had experienced it as such and thus his appeal to them. And when he said, “I’m going to tell our NAFTA partners that I intend to immediately renegotiate the terms of that agreement to get a better deal for our workers…. If they do not agree to a renegotiation, then I will submit notice under Article 2205 of the NAFTA agreement that America intends to withdraw from the deal,” they cheered.
He also told them. “I see the carnage that NAFTA has caused, I see the carnage. It’s been horrible. I see upstate New York, I see North Carolina, but I see every state. You look at New England. New England got really whacked. New England got hit.” “NAFTA has been very, very bad,” Trump said in a speech in Kenosha, Wisconsin, speaking of dairy farmers being hurt by recent Canadian price changes that the farmers believed violated trade standards. “The fact is that NAFTA has been a disaster for the United States and a complete and total disaster.”
Union workers saw their jobs lost (six million the first 16 years of NAFTA) and factories moving to Mexico to take advantage of lower-waged workers. Whatever bad things their party and their media said about Trump, they knew he spoke the truth on this issue and that they would have a friend in the White House if he kept his promise. This is a major reason he won the old northwest and the election. And this is why he could lose the next election if he doesn’t return the jobs.
The problem with Trump’s call for renegotiation of NAFTA, rather than just pulling out, is that when the government negotiates regulations, productions codes, and trade areas it is not free trade and is never fair, even if well intentioned. Free trade has no restrictions on transactions, (not 1,000 pages as in NAFTA) and fair trade implies that both trade parties feel justice in the outcome. NAFTA is government-managed trade.
Trump cannot win this argument. Fair for him is if our existing corporations (who fund his next election) retain advantage over competing new entrepreneurs and foreign competitors are disadvantaged. If advantage is determined by natural law, one out performs, gives better service or products at lower cost but with higher quality, as when individuals make selections, it is both free trade and fair trade. Government can never do this because it can never account for all the variables involved and is impacted too much by the use of government to get advantage. Even Trump fell victim to this as a private citizen when he made political contributions to both political parties should he need advantaged in a business deal down the road.
In the renegotiation special interests seek to enhance governmental powers in their behalf. Michael Brune, the executive director of the Sierra Club, expects the renegotiated NAFTA to include more environmental protections and climate change measures.
Richard Trumka, president of the AFL-CIO, best represents the problem with government deciding winners and losers, “We will do everything we can to make this a good agreement and to hold the president at his word and make sure we get a renegotiation. If it comes out that it is not a good deal, no deal is better than a bad deal,” But what is a “good” deal? With no government intervention both seller and buyer get a “good” deal or a transaction is not processed.
Nancy Pelosi faults President Trump “for all of his rhetoric, President Trump looks to be sorely disappointing American workers on trade.” For Democrats it will never be fair because it is never enough. For Republicans it will never be free because it must be managed. Few from either major political party really believe in limited government or they would adhere to Article I, Section 8 of which most of NAFTA violates.
Congress expects to take up the NAFTA issue mid-August. The fairest and freest trade deal for all Americans is to allow natural law under the free market to rule. If negotiation does not respect these time-tested restraints, and the Constitution, Trump would be best served to work for Article 2205 and withdrawal as suggested by AFL-CIO president Trumka— “no deal is better than a bad deal.” And this, the sooner the better, or, he may pay a heavy price in 2020.
Dr. Harold Pease is a syndicated columnist and an expert on the United States Constitution. He has dedicated his career to studying the writings of the Founding Fathers and applying that knowledge to current events. He has taught history and political science from this perspective for over 30 years at Taft College. To read more of his weekly articles, please visit www.LibertyUnderFire.org.