Trade war heating up among Democrats

The tensions broke into public view after Clinton hedged during her first remarks on whether she would support an Obama-backed trade package that is gaining traction in Congress but is opposed by some on the party’s politically potent liberal wing.

“Any trade deal has to produce jobs and raise wages and increase prosperity and protect our security,” Clinton said during a tour of a community college in Concord, N.H., that focuses on technical skills. “We have to do our part in making sure we have the capabilities and the skills to be competitive.”

Her remarks, which echoed a noncommittal statement from her presidential campaign late last week, placed her in an uncomfortable spot between the pro-business and pro-labor wings of the party. The trade issue is being closely watched by liberals who would prefer a more adamantly left-leaning candidate to carry the Democratic banner.

Potential rivals such as Sen. Elizabeth Warren (Mass.), who has said she is not running for the White House, and Sen. Bernie Sanders (I-Vt.) have denounced Obama’s trade agenda as favoring big business over workers. Former Maryland governor Martin O’Malley, another potential Democratic contender who opposes the package, sent out a barbed tweet Tuesday saying that “Americans deserve to know where leaders stand.”

“The answer is not only no but hell no,” Senate Minority Leader Harry M. Reid (D-Nev.) said when asked by reporters whether he backs pending legislation to smooth the path for Obama to complete a major trade deal in the Asia-Pacific region. Reid emphasized, however, that he will not filibuster the agreement if it reaches the Senate floor.

The increasingly vocal opposition from high-profile Democrats forced Obama to open a debate with longtime allies as he scrambled to try to hold ranks. On Tuesday, the president traveled to the Fairfax Chamber of Commerce in Northern Virginia for a roundtable discussion on trade with local business leaders and Rep. Gerald E. Connolly (D-Va.), who supports the trade deal. The discussion was moderated by liberal MSNBC talk show host Chris Matthews.

Referring to Warren by name, Obama said she and other critics are “wrong on this” and added that although “some of the information that has been getting thrown out there plays into legitimate fears that Democratic voters have, and progressives have, it’s simply not true. It’s simply not the facts.”

On the Republican side, most of the declared and prospective candidates hew to GOP orthodoxy in favor of free-trade deals. But the fissures also are widening on that side of the aisle as the fight for the Republican nomination gets underway and candidates give voice to grass-roots conservatives’ frustrations about the economy.

New Jersey Gov. Chris Christie (R) said Tuesday that the United States needs “to take another look at NAFTA” — the North American Free Trade Agreement, signed in 1993 — while Wisconsin Gov. Scott Walker (R) suggested Monday that legal immigration, which could grow under the trade pacts, might need to be reduced with the aim of “protecting American workers and American ­wages.”

“It is a fundamentally lost issue by many in elected positions today — is what is this doing for American workers looking for jobs? What is this doing to wages? And we need to have that be at the forefront of our discussion going forward,” Walker said.

But it is Democrats who are wrestling with an existential crisis on trade.

At the center of the debate is a “fast track” trade bill that would grant theObama administration the authority to bring the Trans-Pacific Partnership (TPP), a 12-nation trade and regulatory pact in the Asia-Pacific region, to Congress for a vote without lawmakers being able to amend the terms.

Administration officials have said the fast-track powers are necessary to convince the other nations that Congress won’t change the terms after the fact. But opponents — including organized labor and environmental groups — have said the legislation amounts to a rubber stamp of the TPP before the terms are made public.

The bill, introduced last week by Sens. Orrin G. Hatch (R-Utah) and Ron Wyden (D-Ore.) and Rep. Paul Ryan (R-Wis.), will face its first test Wednesday when the Senate Finance Committee holds a vote on it. If it is approved, as expected, the legislation is likely to advance to the Senate floor next month.

The Obama administration is not making it easy for Democrats, some of whom have said they might reconsider their objections if U.S. negotiators insist on protections against currency ma­nipu­la­tion. In a letter to Congress on Tuesday, Treasury Secretary Jack Lew acknowledged their concerns but said the negotiating partners have balked at such measures and added that such provisions “would likely derail” the talks.

At a Senate Finance Committee hearing Tuesday, AFL-CIO President Richard Trumka denounced the package. “The livelihoods of workers are at stake here,” he said. “We need a different deal.”

But Thomas J. Donohue, president of the U.S. Chamber of Commerce, said at the hearing that failing to complete the trade pact would be the “equivalent of going out and resigning from the world. Ninety-five percent of the people that we want to sell something to don’t live in the United States.”

Clinton is viewed as a key barometer among Democrats. As secretary of state, she touted the trade pact as part of the Obama administration’s strategy to shift U.S. foreign policy attention to Asia to confront China’s growing influence.

By the time Clinton left the State Department in early 2013, the Obama administration was deep into negotiations on the TPP, which Clinton had referred to as “the gold standard in trade agreements.”

When he was president, her husband, Bill Clinton, was a fierce champion of NAFTA, having won passage in Congress for that deal during his first year in office. Hillary Clinton and Obama both distanced themselves from that deal, which labor unions during the 2008 campaign blamed for job losses as they sought to appeal to voters in manufacturing-reliant Rust Belt states.

Asked this week whether the president expected Clinton to enthusiastically support his trade push, White House press secretary Josh Earnest replied: “She is going to make up her own mind about what policy positions that she’ll take. And after all, TPP is something that’s still being negotiated.”

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