Democratic President Bill Clinton signed the North American Free Trade Agreement that went into effect on Jan. 1, 1994. The deal was fiercely opposed by labor unions and some environmentalists but backed by Clinton, House Speaker Newt Gingrich, and a coalition that included the U.S. Chamber of Commerce.
What critics say Clinton set into motion was the erosion of American manufacturing, off-shoring of jobs overseas, and union distrust of the Democratic Party by way of shrinking paychecks.
Donald Trump tapped into that frustration when he burst onto the scene in 2015, blasting NAFTA as the “single worst trade deal ever approved in this country” and blaming the husband of his opponent, former Secretary of State Hillary Clinton, for the demise of workers in places like Michigan, Wisconsin, and Pennsylvania.
Now, Trump is making trade deals front and center in his White House comeback bid as Harris struggles to connect with rank-and-file union workers, especially men, who have been leery of the Biden-Harris push for green vehicles. The disconnect could be enough to shatter the blue wall and once again propel Trump to the presidency.
“As soon as I started talking about what I’m going to do, [automakers] stopped building all of the plants in Mexico,” Trump said on Fox News on Sunday. “I said I was going to put in tariffs. To me, ‘tariff’ is a very beautiful word. It’s a word that’s going to make our country rich again. Without tariffs, we have a busted country.”
It’s the opposite side of an argument made by independent presidential candidate Ross Perot in 1992. Arguing against the lowering of trade barriers in NAFTA, which had not yet become law, Perot warned that free trade would gut American manufacturing and lower wages.
“If you’re paying $12, $13, $14 an hour for factory workers, and you can move your factory south of the border, pay a dollar an hour for labor … and you don’t care about anything but making money, there will be a giant sucking sound going south,” he warned.
Some labor support was lost right away when Clinton signed NAFTA after winning the election. The International Brotherhood of Teamsters, which endorsed Clinton in 1992, did not back him during his 1996 reelection bid because it opposed the trade deal.
“Labor pushed really hard against NAFTA in ‘93,” University of Massachusetts at Amherst economist Gerald Friedman recalled. “Almost all 500 of the Fortune 500 CEOs supported it. Businesses backed it, and the AFL-CIO and the UAW fought heavily against it.”
Manufacturing jobs did not immediately leave the United States, remaining steady through 2000. But, according to the Federal Reserve Bank of St. Louis, they fell sharply during the early 2000s recession, continued dropping throughout the decade, and then plummeted during the Great Recession. Overall, more than 5 million U.S. manufacturing jobs were lost between 1997 and 2015.
What’s more, Friedman added, even the jobs that remained often paid lower wages, as corporations had more negotiating leverage in threatening to move to another country. On the business side, if a competitor was enjoying lower labor costs via outsourcing, that put pressure on other firms in the same sector to do the same.
Trump capitalized on anti-NAFTA sentiment during his 2016 upset victory over Hillary Clinton and replaced the deal while in office with the U.S.-Mexico-Canada Agreement.
Now, he’s saying that the deal didn’t go far enough.
“There’s always little tricks they want to play,” Trump said at the MotorCity Casino in downtown Detroit. “I said nope, I want to be able to renegotiate at six years. Otherwise, we’re not making the deal.”
Trump made the comments as he promised China would not be able to sell vehicles into the U.S. from plants it plans to build in Mexico. As currently negotiated, the USMCA allows foreign companies to export cars to the U.S. without steep duties if they are locally sourced.
“I will impose whatever tariffs are required — 100%, 200%, 1,000% — they’re not going to sell any cars into the United States with those plants,” Trump said.
It’s part of a wider play to get union voters, who are overrepresented in the crucial Rust Belt swing states, into his camp. Trump has also pledged to scrap government subsidies for electric vehicles, which he says will put blue-collar employees out of work to make cars that most consumers don’t want.
That approach appears to be paying dividends. The Teamsters endorsed every Democratic presidential candidate between 2000 and 2020 but declined to back Harris this year. A union representing firefighters is also holding out, even though it was the very first labor group to back President Joe Biden in 2020.
While NAFTA only affects trade with Canada and Mexico, it is considered a bellwether in a larger movement toward free trade, which was continued when China joined the World Trade Organization in 2001.
“NAFTA is the model that all these job-killing trade pacts now follow,” the Teamsters said when the agreement turned 20 years old in 2014. “We’ve seen the damage it’s done, yet some want to push forward with even more bad trade deals.”
One year later, Trump stormed onto the political scene.
The Harris campaign maintains it is the only choice for union households. The vast majority of non-law enforcement unions have endorsed her, as have a number of local Teamsters councils.
Friedman maintains that any analysis of NAFTA and free trade has to include the wider context. Trade has brought more goods to consumers at cheaper prices, he says, and has boosted American industries, such as technology, higher education, and entertainment.
Yet he acknowledges that the loss of manufacturing jobs, along with the impact it had on communities in which factories closed, is a real problem that’s top of mind for a lot of voters.
Acknowledging this political reality, Biden kept most of Trump’s tariffs in place after taking office and has proposed even higher tariffs than Trump on China. Friedman said there is a balancing act that must be struck when it comes to trade and that the scales may have tipped too far in the 1990s.
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“NAFTA has definitely had huge political effects, which is why we’re still talking about it 30 years later,” he said.
Bill Clinton is still campaigning 30 years later, too. He is on the trail in Georgia, trying to appeal to rural and black voters and looking to help his party win the White House once more.
