Reidblog [The Reid Report blog]

One of John McCain's most celebrated achievements in recent years was his crusade to block a Pentagon contract with Boeing for a new fleet of midair refueling tankers. Incensed over what he denounced as a taxpayer "rip-off," McCain launched a Senate probe that uncovered cozy relations between top Air Force officials and Boeing execs. A top Air Force officer and Boeing's CFO ended up in prison. Most significantly, the Air Force was forced to cancel the contract—saving taxpayers more than $6 billion, McCain asserted.

But last week, McCain's subsequent effort to redo the tanker deal was dealt a setback. Government auditors ruled that the Air Force made "significant errors" when it rebid the contract and awarded the $35 billion project to Boeing's chief rival, partners European Aeronautic Defense and Space Co. (or EADS) and Northrop Grumman. It's likely the Air Force will have to redo the bid yet again, which analysts say will delay the replacement of the fleet's 1950s-era refueling tankers. The auditors' ruling has also cast light on an overlooked aspect of McCain's crusade: five of his campaign's top advisers and fund-raisers—including Tom Loeffler, who resigned last month as his finance co-chairman, and Susan Nelson, his finance director—were registered lobbyists for EADS. ...

Critics, including some at the Pentagon, cite in particular two tough letters McCain wrote to Deputy Secretary of Defense Gordon England in 2006 and another to Robert Gates, just prior to his confirmation as Defense secretary. In the first letter, dated Sept. 8, 2006, McCain wrote of hearing from "third parties" that the Air Force was about to redo the tanker competition by factoring in European government subsidies to EADS—a condition that could have seriously hurt the EADS bid. McCain urged that the Pentagon drop the subsidy factor and posed a series of technical questions about the Air Force's process. "He was trying to jam us and bully us to make sure there was competition by giving EADS an advantage," said one senior Pentagon official, who asked for anonymity when discussing a politically sensitive matter. The assumption within the Pentagon, the official added, was that McCain's letters were drafted by EADS lobbyists. "There was no one else that would have had that level of detail," the official said. (A Loeffler associate noted that he and Nelson were retained by EADS after the letters were drafted.)

Labels: 2008 election, Boeing, EADS, free trade, jobs, John McCain, NAFTA, outsourcing, presidential candidates

What is the proper word for the claim by Hillary Clinton and the more factually disinclined supporters of her campaign for the Democratic presidential nomination - made in speeches, briefings and interviews (including one by this reporter with the candidate) - that she has always been a critic of the North American Free Trade Agreement?

Now that we know from the 11,000 pages of Clinton White House documents released this week that former First Lady was an ardent advocate for NAFTA; now that we know she held at least five meetings to strategize about how to win congressional approval of the deal; now that we know she was in the thick of the manuevering to block the efforts of labor, farm, environmental and human rights groups to get a better agreement. Now that we know all of this, how should we assess the claim that Hillary's heart has always beaten to a fair-trade rhythm?

Now that we know from official records of her time as First Lady that Clinton was the featured speaker at a closed-door session where 120 women opinion leaders were hectored to pressure their congressional representatives to approve NAFTA; now that we know from ABC News reporting on the session that "her remarks were totally pro-NAFTA" and that "there was no equivocation for her support for NAFTA at the time;" now that we have these details confirmed, what should we make of Clinton's campaign claim that she was never comfortable with the militant free-trade agenda that has cost the United States hundreds of thousands of union jobs, that has idled entire industries, that has saddled this country with record trade deficits, undermined the security of working families in the US and abroad, and has forced Mexican farmers off their land into an economic refugee status that ultimately forces them to cross the Rio Grande River in search of work?

As she campaigns now, Clinton says, "I have been a critic of NAFTA from the very beginning."

But the White House records confirm that this is not true.

Her statement is, to be precise, a lie. ...

How trade policy affects U.S. workers and industries has become a very heated political and policy issue.Ahistoric U.S. trade deficit, which Federal Reserve Chair Alan Greenspan calls “unsustainable,” is causingthe value of the dollar to be dragged down. The trade deals of the 1990s, such as the North American Free Trade Agreement (NAFTA), have resulted in massive U.S. manufacturing job losses. Eight years of NAFTA has cost 766,000 U.S. jobs with 35,262 job losses in Pennsylvania. For those who have found1new employment, it is often service sector jobs at lower wages and without benefits. The government’sanswer to trade job losses is too little too late: a meager program of retraining and extended unemploymentcompensation for which only a fraction of the workers hurt by trade can qualify. The program, called “Trade Adjustment Assistance (TAA),” became a major issue in the extended battle over so-called FastTrack tradeauthority. Fast Track is the name for a procedure which delegates a wide swath of Congress’exclusive constitutional trade powers to the president. Proponents of expanding NAFTA and other tradedeals, which have caused large job loss and other problems, sought the extraordinary process because itwas the only means to overcome public opposition to the current model of special interest trade deals.

After an intense 18-month campaign, on July 26, 2002, President George W. Bush personally trolled thehalls of Congress for support in the House of Representatives for a delegation to him of Congress’ exclusiveArticle I, Section 8 Constitutional authority to set terms for international commerce. This extraordinarydelegation of Congress’ trade authority — Fast Track — was opposed in 1994. This procedure was available for twenty years starting in 1974, but was only ever actually used five times during that period.Congress refused to grant this authority to then-President Clinton eight years ago.

Razor-thin passage of the legislation at 3:30 a.m. on Saturday, July 27, 2002 after an array of proceduralshenanigans secured Fast Track for President Bush, but both a consensus on the direction of trade policyand political momentum on Bush’s trade agenda are absent.

The Fast Track legislation President Bush signed on August 6, 2002 explicitly extends Fast Track treatmentto a 31-nationNAFTA expansion, called the Free Trade Area of the Americas and to an expansion of the World Trade Organization to cover more service sectors of the economy. Passage of Fast Track means new threats of more U.S. job loss, including in the high-tech and service sectors, and damage to U.S. farmers is added to the already significant concerns about how Fast Track undermines the Constitution’schecks and balances. Instead of adjusting the underlying trade rules to suit more Americans, the response by the White House and Republican congressional leaders to growing skepticism about NAFTA expansion and Fast Track wasto launch an attack at efforts by Democrats to reform the TAA program.

Pennsylvania’s NAFTA Job Losses Significantly Higher than National AverageUnder just the NAFTA-TAA program, Pennsylvania has been certified to have lost 30, 226 jobs at 274 facilities as a result of NAFTA, according to an analysis of the Department of Labor records. The share of Pennsylvania jobs certified as NAFTA losses under NAFTA-TAA certifications is significantly greater than Pennsylvania’s share of the national workforce. Pennsylvania had 60% more NAFTA-TAA certifications than its share of the national workforce since NAFTA went into effect. If NAFTA’s job13losses were distributed evenly across the country, each state would lose roughly the same percentage of jobs. According to analysis of Department of Labor figures, Pennsylvania had 11,851 more certified NAFTA job losses to NAFTA than it would if distribution were equal throughout the national workforce.

NAFTA Job Losses Occurred Throughout Pennsylvania

NAFTA layoffs have happened throughout Pennsylvania, from Philadelphia to Erie and White Mills to Masontown. The largest NAFTA layoff concentration of NAFTA-TAA certified job losses was in the14Philadelphia area, which suffered 17% of the NAFTA job casualties listed under the NAFTA-TAA program. The Reading area suffered the second highest concentration of NAFTA-TAA certifications inthe state, with one out of every ten NAFTA-TAA certifications in Pennsylvania.

Labels: 2008 election, Hillary Clinton, NAFTA, politics and elections, presidential candidates, world trade center

OTTAWA — The leak of a confidential diplomatic discussion that rocked the U.S. presidential campaign began with an offhand remark to journalists from the Prime Minister's chief of staff, Ian Brodie.

Prime Minister Stephen Harper vowed yesterday to use whatever investigative means necessary to find the source of leaks that, he said, were "unfair" to U.S. Democratic candidate Barack Obama and may have been illegal — although opposition leaders insisted the Conservatives cannot be trusted to investigate political players on their own team.

But the story that reverberated through the U.S. presidential campaign began as a terse, almost throwaway remark that Mr. Brodie made to journalists from CTV, according to people familiar with the events.

Mr. Brodie, during the media lockup for the Feb. 26 budget, stopped to chat with several journalists, and was surrounded by a group from CTV.

The conversation turned to the pledges to renegotiate the North American free-trade agreement made by the two Democratic contenders, Mr. Obama and New York Senator Hillary Clinton.

Mr. Brodie, apparently seeking to play down the potential impact on Canada, told the reporters the threat was not serious, and that someone from Ms. Clinton's campaign had even contacted Canadian diplomats to tell them not to worry because the NAFTA threats were mostly political posturing.

The Canadian Press cited an unnamed source last night as saying that several people overheard the remark.

The news agency quoted that source as saying that Mr. Brodie said that someone from Ms. Clinton's campaign called and was "telling the embassy to take it with a grain of salt."

The story was followed by CTV's Washington bureau chief, Tom Clark, who reported that the Obama campaign, not the Clinton's, had reassured Canadian diplomats.

Mr. Clark cited unnamed Canadian sources in his initial report.

There was no explanation last night for why Mr. Brodie was said to have referred to the Clinton campaign but the news report was about the Obama campaign. Robert Hurst, president of CTV News, declined to comment.

Who in the Clinton campaign contacted the Canadians? When was the contact made? Did Hillary know about this contact and approve the content of the message? As the NAFTA-gate scandal erupted why didn't she come forth and explain to the voters of Ohio and Texas that her staff had contacted the Canadians? Is her rhetoric about NAFTA genuine and does she in fact intend to renegotiate key aspects of the agreement?

Labels: 2008 election, Barack Obama, Democrats, Hillary Clinton, NAFTA, NAFTA-gate, presidential candidates