Bush's Trade Legacy on the Line as Trump Seeks to Replace Nafta

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President Trump and his wife, Melania pay respects to former President George H.W. Bush as he lies in state in the Rotunda of the US Capitol in Washington, 03 Dec.

President Trump and his wife, Melania pay respects to former President George H.W. Bush as he lies in state in the Rotunda of the US Capitol in Washington, 03 Dec.


Photo:

jim lo scalzo/epa-efe/rex/Shutterstock

President Trump will pay his respects today to the late President George H.W. Bush, after last week also saying farewell to one of the legacies of his Republican predecessor—the North American Free Trade Agreement.

Nafta was signed in Mr. Bush’s last year in office and ratified under President Bill Clinton the following year. Mr. Trump is set to begin the process of withdrawing from Mr. Bush’s original agreement, seeking to replace it with the Trump administration’s reworked pact called the U.S.-Mexico-Canada Agreement, or USMCA.

In doing so, the Trump administration is giving Congress a choice between ratifying Mr. Trump’s new trade pact or returning to the pre-Nafta state of the early 1990s, including tariffs, and the end of the favorable trading status the U.S. has with its neighbors.

Former presidents Bill Clinton and George H.W. Bush in February 2005. Nafta was signed in Mr. Bush’s last year in office and ratified under Mr. Clinton the following year.

Former presidents Bill Clinton and George H.W. Bush in February 2005. Nafta was signed in Mr. Bush’s last year in office and ratified under Mr. Clinton the following year.


Photo:

vinai dithajohn/epa-efe/rex/Shutterstock

The Nafta rewrite shows how far trade politics have shifted—especially within the Republican Party—in the 26 years since Mr. Bush joined Mexican and Canadian counterparts in signing the original treaty.

“Free trade is the way of the future,” Mr. Bush announced in San Antonio at an initializing ceremony for Nafta in 1992.

“I am a Tariff Man,” Mr. Trump said this week on Twitter. “When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so. It will always be the best way to max out our economic power.”

Mickey Kantor, the Democratic U.S. trade representative under former President Clinton, said the shift of views on Nafta is a “stark and not-welcome contrast.” Mr. Kantor spearheaded the congressional approval of Bush’s Nafta after adding annexes on labor rights and environmental protections.

The U.S. and Canada reached a last-minute deal late on Sept. 30 to revise the North American Free Trade Agreement. We look at what it is and what’s changed. Photo: Getty Images.

“George H.W. Bush believed that he should lead, believed in a world that would be global whether we liked it or not,” Mr. Kantor said. “It seems like the Trump administration is retreating.”

Mr. Trump’s chief economic adviser, Lawrence Kudlow, sees it differently, saying on Monday that “President Trump regards himself as a trade reformer,” and that “he wants a world of zero tariffs and zero nontariff barriers and zero subsidies,” so long as trading partners play fair.

The rhetoric aside, the reworking of the agreement shows a sharpening focus on labor and a growing reluctance to allow corporations to move jobs easily to foreign countries. Messrs. Kantor and Clinton, when seeking congressional approval for Mr. Bush’s Nafta deal, added a section raising labor standards, a move designed to prevent American firms from cutting corners on worker rights when shifting any production to Mexico.

And yet the concern that workers haven’t gotten a fair shake from trade agreements has intensified in recent years, as seen in the popularity of Sen. Bernie Sanders’ skeptical attitude toward trade when he was seeking the Democratic nomination in 2016. Mr. Trump would win the presidency as a Republican on a similar trade platform.

While the Trump administration further tightened labor standards when negotiating the agreement, Democrats in Congress say they want to include even more provisions to make sure the higher standards are enforceable—and that Mexico follows through on promises to give more power to unions.

If the Trump administration and Democratic leaders strike a deal, it will ease the path to what is essentially a more stringent version of Mr. Bush’s Nafta, with greater protections for workers, as well as some rules designed to deter companies from adding manufacturing capacity in Mexico.

If they don’t come to an agreement, then Mr. Trump is set to proceed with his plan of withdrawing from Mr. Bush’s Nafta, a path that will lead to legal challenges and efforts to rescue the 1992 deal.

Either way, the legacy of both presidents hangs in the balance.

Write to William Mauldin at william.mauldin@wsj.com