Commentary

Which John Kerry Will Shape U.S. Trade Policy?

By Daniel Griswold
This article was published in Apple Daily (Hong Kong) on August 18, 2004.

In his nomination speech in July, Democratic presidential candidate John Kerry told the nation he was “reporting for duty.” But when it comes to shaping America’s trade policy toward China and the rest of the world, it remains unclear which John Kerry would report for duty next January if he’s elected president.

As a four-term Democratic senator from Massachusetts, Kerry has compiled an impressive record of support for free trade. He voted in favor of every major trade bill to come before Congress: the Uruguay Round Agreements Act, the North American Free Trade Agreement, normal trade relations with China and then permanent NTR in 2000, more generous market access for imports from Africa and the Caribbean, and trade promotion authority for Presidents Clinton and Bush. He was one of a minority of his party in the Senate to reject steel quotas in 1999.

Kerry’s record on trade has its blemishes. He voted for the huge farm subsidy bill in 2002 that President Bush signed. He voted for more restrictive language on labor, environmental, and human rights standards in trade agreements. He voted to make it more difficult to reform America’s much abused antidumping laws in World Trade organization negotiations. But those deviations aside, his record in Congress has been pro-trade, especially for a Democrat.

As a presidential candidate, however, John Kerry has staked out a more skeptical line on trade. While paying lip service to the need to trade, he has ratcheted up his call for “enforceable labor and environmental standards at the core of every trade agreement,” skipping over the fact that most developing countries in the WTO have made it perfectly clear they will not sign agreements that contain such language.

In his July speech, Kerry said, “We will trade and compete in the world. But our plan calls for a fair playing field” — whatever that would mean in practice — “because if you give the American worker a fair playing field, there’s nobody in the world the American worker can’t compete against.” To deliver that “fair” playing field, Kerry has proposed reviewing and even re-opening existing agreements and aggressive use of the Super 301 trade law that threatens other countries with unilateral U.S. sanctions. To slow “outsourcing,” he wants to impose new regulations on U.S. companies and restrict government contracts to companies that promise to do all the work in the United States.

Equally disturbing has been Kerry’s attacks on the patriotism of his fellow Americans. He’s described executives who’ve tried to control costs by moving some operations overseas as “Benedict Arnold CEOs” — as if trying to stay competitive in global markets is somehow un-American. He’s promised to “appoint a U.S. Trade Representative who is an American patriot and who will put American jobs first” — as if past and present USTRs have not been good, decent Americans committed to the same bi-partisan, post-war trade expansion that has brought so much peace and prosperity to the United States and its trading partners.

His choice of Sen. John Edwards of North Carolina as a running mate only reinforces this retreat from free trade. In contrast to Kerry, Edwards voted in favor of steel quotas and against opening the U.S. market to apparel imports from Africa and against final passage of trade promotion authority. Edwards ran against NAFTA during his 1998 campaign and even voted against free trade agreements last summer with Chile and Singapore. (Kerry missed those votes.) The one bright spot on the Edwards record has been his support in the past for normal trade relations with China.

What would all this mean for trade policy in a Kerry administration? Probably not as much as the campaign sound bites would indicate. The anti-trade noise generated in U.S. elections is always worse than any legislation the politicians finally enact. John Kerry’s swipes at trade are popular with the Democratic Party’s core constituencies of organized labor and environmental activists, but trade has simply not been a decisive issue in recent presidential or congressional campaigns.

Nonetheless, trade policy would change under a Kerry presidency. If he wins what everyone expects will be a close race, his anti-trade constituencies will want to collect on their victory. The price may be fewer bilateral and regional trade agreements, and probably none with less developed countries where labor and environmental standards would be an issue. The first casualty would likely be the Central American Free Trade Agreement, which Kerry has vowed to either renegotiate or veto.

Fortunately for the global trading system, economic and foreign-policy realities, as well as what is likely to be another Republican Congress, will probably block any sharp turns toward protectionism by a Democratic administration.

Daniel Griswold is director of the Center for Trade Policy Studies at the Cato Institute.