WASHINGTON – A controversial six-year-old campaign promise by Barack Obama to renegotiate NAFTA made a re-appearance Tuesday.
The president’s trade secretary said that renegotiation is precisely what’s happening right now with the Trans-Pacific Partnership, the ongoing attempt at a major 12-country trade deal.
Michael Froman said the ongoing talks are allowing the president to make good on his 2008 promise to reopen the old North American Free Trade Agreement to improve labour and environmental standards.
“As a candidate for president, then-senator Obama said he would renegotiate NAFTA, put labour and environmental standards at the core of trade agreements, and make those standards enforceable like any commercial commitment,” Froman said in a speech Tuesday to the Center for American Progress.
“And that’s … exactly what we’re doing in TPP: upgrading our trading relationships not only with Mexico and Canada but with nine other countries as well.”
The issue of reopening NAFTA bedevilled Obama’s first presidential campaign and may have delayed his victory in the Democratic primary.
His campaign was sideswiped by chatter from Canada that the promise was an empty one and not to be taken seriously. The ensuing controversy led to a leak investigation in Canada and rocked the office of Prime Minister Stephen Harper.
Just as it did six years ago, the Harper government again played down the idea that the agreement was being reopened.
“We are not re-negotiating NAFTA,” said a spokesman for Prime Minister Stephen Harper, who is in Mexico for Wednesday’s so-called Three Amigos summit with Obama and Mexican President Enrique Pena Nieto.
“It would be inaccurate to say so.”
Still, the Froman comments caused some head-scratching on different parts of the continent.
One watcher of Canada-U.S. relations said it was unclear whether Froman meant to say NAFTA provisions might actually be reopened in the new trade talks, or whether he was just trying to cast the TPP as different from a 20-year-old agreement that is relatively unpopular in the U.S.
A 2010 poll by the Pew Center points to seemingly contradictory attitudes in the U.S. on trade.
Some 76 per cent of respondents said they supported more trade with Canada, and 52 per cent said they supported more with Mexico, but only 35 per cent of those surveyed said they liked NAFTA.
The Canadian-American Business Council said it’s probably best if North American countries team up to negotiate as a united front with Asia — and not renegotiate NAFTA against each other.
“We took note of USTR Ambassador Froman’s comments today that the Obama Administration is looking to the TPP to fulfill a campaign promise to renegotiate NAFTA,” said Maryscott Greenwood, a D.C.-based senior adviser with the council.
“Our view is that while NAFTA needs to be modernized, all in all it was a success and we would hope that the NAFTA countries approach future trade deals together as a block instead of as competitors.”
There was a similar message in a document released Tuesday by the Wilson Center, a Washington-based think-tank.
The 68-page report on North American relations suggests the three countries stand to gain if they approach the TPP as a united front. One benefit of that approach, it said, was that goods built by more than one NAFTA country would be treated the same way in the new trade zone.
The report also touted the benefits of greater internal North American trade.
It cited a study that the average Mexican product purchased in the U.S. carried 40 per cent American content — and that the average Canadian product purchased in the U.S. carried 25 per cent American content.
By comparison, the figure for Chinese goods was only four per cent.
At an event at the Wilson Institute, timed to coincide with the Mexican summit, one panellist suggested those stats make a mockery of a famous prediction from 1992 presidential candidate Ross Perot — that NAFTA would send U.S. jobs to Mexico.
The centre’s Christopher Wilson said NAFTA has actually proven to be a defence mechanism — against the risk of losing jobs to China.