Simon Lester at the National Interest writes:
Tough talk on trade may be seen as necessary during campaigns, but a president naturally looks outward. International affairs is an area where a president has a great deal of power, and presidents are drawn to it. A former secretary of state, Hillary Clinton will be no different, and at some point she will look for ways to engage with other countries in trade negotiations.
In other words, how can the Trans-Pacific Partnership deal get done politically after a campaign in which both sides lost their heads in a wave of protectionist fever. Clinton understands not only the economic importance of TPP but the political urgency. Eight former secretaries of defense joined in urging passage of the deal purely on national security grounds. With an aggressive China it is more critical than ever to embrace and support our democratic allies in the region. Defeat of TPP would be a horrible blow to them and a big win for China.
Assuming the TPP is not passed in the lame-duck Congressional session, she will immediately be confronted with the reality of a fully negotiated trade agreement that key U.S. trading partners would like to see ratified. Signing the TPP would be an obvious way forward on trade and on foreign policy. …
What Clinton needs is a significant revision to TPP that she can tout as a real reform to trade agreements, one that satisfies some of the TPP’s critics on the left. A minor tweak is unlikely to assuage anyone; this change needs to be a major one. Fortunately, there is a TPP provision that fits the bill perfectly: investor state dispute settlement (ISDS), the procedure that allows foreign investors to sue governments in an international tribunal. Removing ISDS could triangulate the TPP debate, allowing for enough support to get it through Congress.
He points out that she opposed ISDS and that the left hates it. It should be noted that the right generally dislikes international tribunals that curtail U.S. sovereignty.
Ideally, as Lester points out, the lame-duck Congress might push through the TPP. If not, the ISDS fix might do it. Depending on the election results and how many pro-free-trade Republicans lose, it still might not be sufficient. Here’s a further suggestion: Couple it with a substantial infrastructure project that Clinton wants, but with substantial safeguards to make sure that the money is wisely spent. Clinton gets a big jobs bill — popular with both sides — and a revised TPP gets through.
It’s important for Republicans, however, to make sure that this does not become Son of Stimulus. Democrat Larry Summers, who served as treasury secretary under Bill Clinton, has recognized (in a op-ed written with Rachel Lipson):
America desperately needs a major increase in infrastructure investment and, if carried out effectively, an investment program could come close to paying for itself by generating an expanding economy. With record low interest rates, low material costs, and high construction unemployment, there is no better time. When states defer maintenance and repair for decades — as was done with the Anderson Bridge — it places a huge burden on future generations.
However, to collectively tackle the nation’s crumbling infrastructure, citizens need to believe that the government is up to the task. In an era when public trust in government remains near all-time lows, every public task is freighted with consequence. The relationship is cyclical — if government can start being more effective, it will win more trust, leading to more effectiveness. If, on the other hand, projects such as the Anderson Bridge repair project become the norm — then we are fated to increasing cynicism and distrust.
Perhaps Clinton should appoint Summers to oversee the infrastructure initiative.
In short, we are likely to have divided government next year. It behooves both sides to start thinking pragmatically about what deals are possible and how inflammatory rhetoric and economic illiteracy can end with the election results. They can start by amending and passing the TPP and ushering in a new accountability ethos with an infrastructure bill.