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Tuesday, Oct. 21, 2008

Obama swings and misses on trade issues

BEVERLY HILLS, Calif. — "Americans are angry," said John McCain, while debating his opponent Barack Obama last Wednesday night in their final face-to-face televised debate, "and they have every reason to be angry."

The Republican candidate for the U.S. presidency certainly got that right. The American people are angry that their retirement nest eggs are cracking, that the wars in Iraq and Afghanistan keep on raging with no end in sight, and that too many American politicians remain pettily partisan when what's needed is national unity.

But Americans aren't the only people angry with America. A lot of people around the world feel the same way — and in some sense rightly so. Our elite political and business establishments have not only screwed up the U.S. economy; they have hurt the world economy as well.

For years we have been preaching to other countries about the near-religious virtues of management accountability and financial transparency, not to mention the need for rigorous quality control of export products.

And then we permitted our elites to leech investment money out of honest pockets, construct and then package mortgages like proverbial houses of cards, and then peddle toxic investment products worldwide under the glossy fog of complexity and ambiguity.

It was anything but an entirely scurrilous assertion when, recently, a top official in China's central bank blamed rich nations of the West for triggering the current global economic turmoil. The U.S. government and elite, which have been lambasting Beijing for years for keeping its currency inflated and unconvertible, could not respond to that.

Both McCain and Obama offer the prospect of better governance, to be sure. It is a widely held view here that the nation and the world would be much better off with either one in the White House than the one who is there now.

The American news media in general greatly favor Obama. The reasons are not necessarily ideological — that he's a liberal, while the former Vietnam War prisoner McCain is not. Obama speaks better, holds himself with more presidential heft and, of course, bodes to become our first president of color.

But viewers worldwide should also note the tendency of our news media to fall in love with the "good guy" and defend their new boy with evident cynicism and criticism toward everything his opponent would say or do. A case in point was the issue of protectionism. Commendably, McCain portrayed himself as a free-trader and apparently felt no need to qualify or footnote.

By contrast, Obama, coming from America's hard-hit Midwest, raised the issue of our economic relations overseas in a way that our friends across the globe could find troubling. In his administration, the Democratic candidate announced, tax breaks for American companies "shipping jobs overseas" would be curtailed. This comment made me edgy.

There are better, less punitive ways to deal with the phenomenon of American companies seeking to gain control over their labor costs — but last week Obama did not put any out there.

Obama also expressed sharp dismay that Japanese and Korean manufacturers have been so proficient in developing and marketing energy-efficient cars in the U.S.; that China was still "manipulating" its currency, and that some free-trade agreements (like the one with Colombia) were a bad deal for America.

Alas, McCain was not, for some inexplicable reason, able to rejoin with some obvious points. One is that congressional approval of the pending free-trade agreement with South Korea would open up the market for American cars (Obama Democrats are against it). Another is that in the current worldwide financial crisis, China should consider itself perhaps justified in having protected its national coin from Western sharks and market turbulence.

America's trade negotiators — in both the Bush and Clinton administrations — have been anything but pushovers in all of these tough bilateral negotiations.

Sure — let's give Obama his due. For the third consecutive time, the Illinois senator "won" the debate, especially on style (shades, perhaps, of "Slick Willy," as Bill Clinton used to be called). Every poll in this country shows Obama winning this election as it moves to the end. Indeed, if we opened the contest to the voters of the world, the Illinois Democrat would win by an even larger margin, presumably.

But Obama is not right on every issue, and McCain is not wrong on every issue.

Why has Obama not gotten the trade issue as right as McCain? It's simple: the Democratic Party includes unions and human-rights groups that often work against lower trade barriers for various reasons (some better than others). Obama is a Democrat.

A Democratic White House will complicate the international-trade picture, at a time in world history when the worst medicine for the global economy would be a push in the direction of a new American protectionism.

Syndicated Columnist Tom Plate is a veteran American journalist who has been commenting on U.S. presidential campaigns since 1980. © 2008 Pacific Perspectives Media Center

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