Published on Wednesday, June 15, 2005 by the Boston Globe
Head in the Sand
by Robert Kuttner
Somewhere in a parallel universe, real leaders in a country very much like
our own are dealing with real problems. Imagine what America might be like
if our top officials were addressing the genuine challenges that confront
us.


Domestically, the president might have responded to the 9/11 attacks by
calling for equality of sacrifice, as presidents have done in every other
wartime emergency. Instead, our president pushed through a succession of
upscale tax cuts and urged people to go out and shop.


In the parallel universe, the American leader is serious about securing our
country. Here, it fell to the opposition party to demand that something as
basic as airline security not be left to private, minimum- wage contractors.
Nearly three years after 9/11, America's ports and other vital
infrastructure are still sitting ducks. While the Department of Homeland
Security played Keystone Kops with color-coded alerts that seemed
suspiciously timed to alarm the public in an election year, the different
agencies that were merged into one are still working on how to communicate
with each other.


In that other universe, the president surely would have enlisted America's
allies to combat terrorism. Had war between the United States and Iraq come,
it would have come with the full participation of the world community, so
that Iraq's reconstruction and the burden of keeping it secure would have
been broadly shared instead of falling upon American taxpayers and GIs.


One can imagine a whole to-do list of the president's national priorities:


Repairing American democracy. American citizens still have no assurance that
their votes will be accurately counted. Big money is crowding out citizen
participation in politics more grotesquely than ever. More ominously, our
ability to decide to rise up and throw the rascals out is being eroded by
partisan trickery.


Fixing our retirement system. Corporate pension funds have been allowed to
become dangerously underfunded. The public Social Security system will need
an overhaul to match it to longer lifespans. In our parallel universe, both
parties would work together to make the necessary, fairly minor,
adjustments. In this universe, the ideological goal of privatizing the
system blocks fixing it.


Keeping America healthy. Our present system, which wastes at least 25
percent of all premium dollars on paper-shuffling, claims processing, and
profit, hurts doctors and patients, the insured and uninsured, alike. An
administration of grown-ups would get serious about getting everyone
covered, preserving free choice of doctor and hospital and getting rid of
parasitic middlemen.


Dealing with global climate change. With serious people running the country,
nothing would be a higher priority, because global warming will irrevocably
change the planet. In that parallel universe, leaders are investing
seriously in clean, carbon-free energy. Here, our leaders and their oil
company brethren are in drill-deeper denial.


Saving the economy. In our imaginary parallel universe, leaders are
reversing the huge dependence of the United States on foreign borrowing and
the endless public deficits that are starving public services. Here,
starving public services is a deliberate ideological strategy. Leaders make
dire threats against China one moment and gratefully accept its loans the
next. Meanwhile, American jobs continue to flow outward to nations with peon
wages while the administration's corporate allies cheer.


Giving every child a chance. High-stakes testing won't equalize life chances
if poor kids don't come to school ready to learn. In that parallel universe,
the nation is investing seriously in early-childhood education.


Using science to the fullest. In a generation, scientific advances could
prevent or cure most of the scourges that ravage Africa as well as diseases
amenable to stem-cell breakthroughs, such as Parkinson's and Alzheimer's,
ALS, and viral plagues such as AIDS. In that parallel America, leaders are
providing the funding for public research, being generous with help to
Africa, and wrestling with genuine ethical dilemmas such as the limits of
cloning. In this universe, while real menaces like avian flu are on our
doorstep, religious fundamentalists and drug companies dictate science
policy.


In a decade, historians will ponder how the American people could possibly
have reelected a president who lives in a fantasy world and who is doing
such damage to the real world.


The poet e.e. cummings wrote, at the end of a fine poem lamenting the
condition of humankind, ''Listen, there's a hell of a good universe next
door. Let's go." We, alas, don't have that option. We have to bring sanity
to the world we are living in.


Robert Kuttner is co-editor of The American Prospect.


© 2005 Boston Globe

***



http://www.bloomberg.com/apps/news?pid=10000086&sid=am3PY7KemuCo

Bloomberg     June 13, 2005

NAFTA's tarnished reputation hurts Bush on Central America pact

The North American Free Trade Agreement's tarnished reputation has become
one of the biggest impediments to President George W. Bush as he starts his
final push to win approval of a similar accord with Central America.

House members such as Democrat John Spratt of South Carolina and Republican
Howard Coble of North Carolina, who both supported the 1993 agreement to cut
trade barriers with Mexico and Canada, say they are leaning against the
Central American Free Trade Agreement because their constituents keep
reminding them what a mistake Nafta was.

"Nafta was grossly oversold by its advocates, and as a result, when people
see pain going on in the economy, they are quick to attribute that pain to
Nafta," Republican Representative Phil English of Pennsylvania said in an
interview.

Nafta was originally proposed by President Ronald Reagan and negotiated
during the presidency of Bush's father, George H.W. Bush. Bill Clinton
narrowly won congressional approval for the accord by promising it would add
"high-paying" U.S. factory jobs, develop a Mexican consumer base for U.S.
exports and stem the flow of illegal immigrants.

Instead, U.S. manufacturers have shed almost 3 million jobs, per capita
income in Mexico has lagged, illegal immigration has more than doubled, and
a trade surplus with Mexico in 1993 slid into a deficit by 1995 -- where it
has remained ever since.

Irony

Eric Farnsworth, who helped negotiate Nafta while at the State Department in
1992, says the irony is that by many yardsticks Nafta has been beneficial.
Total trade between the U.S. and Mexico has more than tripled, to $267
billion, according to the Commerce Department; exports to Mexico have more
than doubled and U.S. investment in the country has almost quadrupled to
$61.5 billion.

"We did oversell Nafta, but in the 10 years that it has been in effect,
Nafta has been successful," says Farnsworth, now vice president of the
Council of the Americas in Washington.

For the past decade, though, unions have been "on an unrelenting campaign"
against Nafta, Farnsworth says. And in Cafta, he says the public is being
presented with an accord "that literally sounds alike." John Sweeney,
president of the AFL-CIO, the nation's largest labor organization, blames
Nafta for the loss of U.S. manufacturing jobs, and said in a June 9
interview that lawmakers who support Cafta "certainly would be held
accountable in their home district."

The Central American accord would end duties on 80 percent of the $15.7
billion in U.S. exports to Guatemala, Costa Rica, El Salvador, Honduras,
Nicaragua and the Dominican Republic; expand patent protections; and allow
greater market access for U.S. banks and insurers. It would also allow a 50
percent increase in sugar imports from the five Central American nations,
phased in over 15 years, and make permanent the duty-free access to the U.S.
market that most products from the region already enjoy.

Beginning Debate

The Senate Finance Committee will begin debate tomorrow after months of
delay owing to opposition from labor, sugar and textile groups. So far,
Cafta has been endorsed by only four Democrats, compared with 102 who voted
for Nafta; the No. 2 House Democrat, Representative Steny Hoyer of Maryland,
predicts that fewer than 20 members of his party will vote for Cafta.

Representative Xavier Becerra of California, who says he regrets voting for
Nafta, opposes Cafta because he says it doesn't have strong enough labor
provisions and won't raise living standards.

"We are hoping we can convince the administration that the votes aren't
there," so it will renegotiate the deal, says Becerra, a Democrat
representing parts of Los Angeles.

Close to Consensus

It isn't just Democrats who have concerns. English, who hasn't decided if he
will vote for Cafta, says there is "close to a public consensus" that Nafta
is a failure. A February poll, taken for the anti-Cafta
AmericansForFairTrade.org by Ayres, McHenry and Associates, found 51 percent
of registered voters believe Nafta "has been bad for the U.S. economy,"
compared to 37 percent who see it as a boon.

"We do hear a lot of things and anecdotes about" Nafta's failure, U.S.
Commerce Secretary Carlos Gutierrez said in an interview. "But we need to
look at facts, and the facts are that the economy has grown substantially
since Nafta." The North American "region of the world is outperforming the
European Union and other areas, and that wouldn't be happening if Nafta
weren't successful," he says.

Mickey Kantor, who was Clinton's trade representative and negotiated a
variety of companion accords with Mexico to help sell Nafta to Congress,
says: "Is it perfect? No. But has it fulfilled what I saw as its promise?
Absolutely." Clinton, who declined a request for an interview, hasn't taken
a public position on Cafta.

Surging Exports

Peoria, Illinois-based Caterpillar Inc., the world's largest maker of
earthmoving equipment, has seen its exports to Mexico more than triple. U.S.
automobile exports have surged to 160,000 vehicles a year from only 4,000
when Nafta was signed. And Procter & Gamble Co., the biggest U.S.
household-goods maker, says Nafta has allowed it to establish a broad North
American market and double sales in Mexico in seven years.

"Anytime anything goes wrong in the U.S. economy, it's convenient to blame
Nafta," says Scott Miller, director of government relations at
Cincinnati-based Procter & Gamble. "But every number I see tells me that
Nafta was a success."

That dichotomy can be seen in the U.S. textile industry. The industry has
shed more than half its jobs since the agreement went into effect in 1994;
at the same time, U.S. textile exports to Mexico tripled as American textile
makers sold their fabric to Mexican sewing factories, where it was turned
into clothing and exported back to the U.S. duty-free.

Good for Textiles?

"Nafta was very good for the U.S. textile industry," says Cass Johnson,
president of the Washington-based National Council of Textile Organizations,
which has endorsed Cafta. "But there is a sense that Nafta is to blame for a
lot of job losses."

Only two of the 23 lawmakers from North and South Carolina, the two largest
textile-producing states, have announced support for Cafta, even after the
endorsement by Johnson's group, the largest textile-industry lobbying
organization.

Gary Hufbauer, an economist at the Institute for International Economics in
Washington whose 1992 study on the probable impact of Nafta was used by
Clinton to justify his public case for the accord, says many of its
shortcomings stem from Mexico's failure to enact the kinds of free-market
policy changes needed to spur growth.

In 1992, Hufbauer predicted that the U.S. trade surplus with Mexico would
increase as the Mexican economy grew by 6 percent a year. Instead, growth
has averaged 3 percent a year, and the accord's benefits haven't filtered
down to the poorest in the country, Hufbauer says.

Senator Max Baucus of Montana, the top Democrat on the Finance Committee,
says that "people wonder what benefits they've gotten" from Nafta and the
series of trade agreements that followed. Baucus who voted for Nafta, last
week called on the Bush administration to renegotiate Cafta. "People are
angry," he says. "They find these agreements suspect."


To contact the reporters on this story: Mark Drajem in Washington at
[EMAIL PROTECTED]







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