Why on Earth Are Hillary and Obama Supporting Pro-Corporate Trade Deals?

By Joshua Holland, AlterNet. Posted November 13, 2007.

With the announcement that Hillary Clinton will join Barack Obama in supporting a new trade deal with Peru that passed in the House last week -- the first in a series of "free-trade" deals that are based on the deeply unpopular NAFTA model and being pushed through Congress by the Bush administration -- the divide between the two Democratic front-runners and the American electorate couldn't be clearer.

There's certainly no constituency for it within the universe of Democratic primary voters -- all of the Peruvian and most American unions oppose it, as do key environmental and anti-poverty organizations -- and it certainly won't win any "swing" voters to the party or make the Democratic brand more popular in any battleground states.

I asked Todd Tucker, research director of Public Citizen's Global Trade Watch, who really stands to benefit from the deal. He didn't hesitate before rattling off a dozen multinationals including Citigroup, Occidental Petroleum and Wal-Mart, all of whom, according to Tucker, have "put their full might into getting the Peru deal passed, including showering millions in congressional campaign donations since January alone." Tucker told me their wish list includes "privatized social security systems for Citi, rainforest-destroying oil extraction for Occidental, and a push to Wal-Mart's efforts to buy out Peru's retail sector, just as they did in Central America just days after Bush signed [the Central American Free Trade Agreement]." In addition, General Mills, (and the Grocery Manufacturers Association PAC, which supports it) wants the deal to go through because it grows most of its canned veggies in Peru (decimating onion, asparagus and pea farmers in the United States) and is now moving its processing facilities down there. Citibank, along with other financial services firms, wants the deal because it would allow the firm to sue the Peruvian government for damages if progressive activists succeed in reversing a disastrous social security privatization scheme that's screwed over millions of Peruvian retirees.

The rest of the field has come out in opposition to the Peru agreement, and one candidate, Dennis Kucinich, has gone so far as to call for abolishing the WTO. But like Obama and Clinton, Joe Biden, Christopher Dodd and Bill Richardson are all enthusiastic, self-described "free traders." It's John Edwards, considered a distant third in the race by the punditocracy, who is making the Peru deal into an issue that he hopes will speak to the candidates' overall judgment as well as their concern for issues of economic justice. "Like the failed free trade agreements before it," he said in a statement, "the Peru Agreement puts the interests of the big multinational corporations first, ahead of the interests of American workers and communities."

Supporting the NAFTA model does speak to the candidates' judgment. Obama said that he'd vote for the Peru deal because "it contained the labor and environmental standards sought by groups like the AFL-CIO," but the AFL-CIO released a statement saying that, because of "several issues of concern to working families," the AFL-CIO "is not in a position to support the Peru FTA." "Labor and environmental protections" are a scam -- Tom Donohue, head of the U.S. Chamber of Commerce, said that his members were "encouraged" by assurances that the deal's labor provisions "cannot be read to require compliance."

Obama went on to insult the intelligence of a crowd of New Hampshire residents by explaining: "We cannot draw a moat around the U.S. economy because China is still trading, India is still trading." But objecting to these new NAFTA-style deals has nothing to do with moats. We already have a treaty with Peru, and 150 other countries, that established a rules-based trading system, complete with a dispute-resolution process. It's called the WTO, and fair trade activists -- many of whom also happen to make up a large chunk of the Democratic party's base -- already object to that institution's consistently giving too much to investors without paying more than lip service to protecting other stakeholders. No real Democrat should talk about "moats" when we have binding trade deals in place covering 98 percent of the planet.

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Joshua Holland is an AlterNet staff writer.