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Biden oversimplifies the 1993 debate over NAFTA side agreements

Democratic presidential nominee Joe Biden (Patrick Semansky/AP)
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“The fact of the matter is NAFTA was not the deal that was sold. When Bush said we’re gonna have an enforcement mechanism with NAFTA, they didn’t do it. That’s why after it passed and he did not insist on that, I was against NAFTA and we tried to begin to change it because it didn’t keep the deal that was made. The enforcement mechanisms were abandoned.”

— Former vice president Joe Biden, in an interview with Jake Tapper on CNN, Sept. 10, 2020

This was a confusing comment by the Democratic presidential nominee regarding the North American Free Trade Agreement.

Biden is under attack by President Trump for supporting NAFTA when it was approved in 1993. During this interview, he conceded that he thought the revision signed by Trump, known as the U.S.-Mexico-Canada Agreement (USMCA), was an improvement. (Biden mostly credited House Democrats for insisting on stronger environmental and labor provisions before voting to approve it.)

But here he suggests he was against NAFTA before he was for it, and faults a President Bush for failing to live up to commitments he made. What’s going on here?

The Facts

Part of the issue is that there have been two Bush presidents — George H.W. Bush and his son, George W. Bush. When Biden was Barack Obama’s running mate in 2008, Democrats attacked George W. Bush for his handling of NAFTA and said they wanted to renegotiate it and step up enforcement of labor and environmental rules.

But in this case, the Biden campaign says, Biden was referring to the first President Bush.

NAFTA is closely associated with Bill Clinton, as he won congressional approval for it after he defeated George H.W. Bush in 1992. But, as we have noted before, the trade deal was actually negotiated and signed by George H.W. Bush shortly before he left office. Indeed, more Republicans than Democrats voted for the deal, as the trade pact was vehemently opposed by labor unions.

During the 1992 presidential debates between Bush and Clinton — which included independent Ross Perot, a fierce foe of NAFTA — Clinton said he supported the trade deal only if agreements were added to strengthen labor and environmental practices in Mexico.

“I am the one who’s in the middle on this,” Clinton argued. “Mr. Perot says it’s a bad deal. Mr. Bush says it’s a hunky-dory deal. I say on balance it does more good than harm if, if we can get some protection for the environment so that the Mexicans have to follow their own environmental standards, their own labor law standards, and if we have a genuine commitment to reeducate and retrain the American workers who lose their jobs and reinvest in this economy. I have a realistic approach to trade. I want more trade, and I know there are some good things in that agreement. But it can sure be made better.”

After Clinton was elected, he pursued these side agreements. It was the first time labor and environmental issues were addressed in a trade agreement, but at the time, the side agreements were viewed as more of a fig leaf to win votes than tough provisions with teeth. Still, they allowed wavering lawmakers such as Biden to support NAFTA. (Earlier in 1993, Biden had told the Wilmington News Journal, “If I had to vote today, I would vote no.”)

“When President Clinton said that he would only support the NAFTA negotiated by the Bush administration if he could get side agreements to improve it, I agreed with him,” Biden said in a floor speech in November 1993 saying he would vote for NAFTA. “The premise of the agreement to improve it, I agreed with him. The premise of the agreement is undeniable — more open exchange with our closest neighbors and most important trading partners was inevitable, and ultimately in the best interest of all three countries. But we needed better protection for workers on both sides of the border, and for the environment. I believe the agreements reached by the Clinton administration are a real improvement — they provide us with leverage we have never had in any other trade agreement to promote compliance by Mexico with their environmental, safety, health, and child labor laws. No, NAFTA does not transform Mexico into a mirror-image of our country, but no trade agreement can, or ever will.”

So that’s what Biden meant when he said he was against NAFTA before “the enforcement mechanism” was added.

But here’s the problem — he says Bush originally said there would be such an enforcement mechanism but that it was “abandoned” during the negotiations.

There is no evidence that is the case. Bush rejected the idea in the debates with Clinton. Moreover, the side agreements that were added were not considered enforcement mechanisms. That was a separate element of NAFTA, which was in the original agreement inked by Bush. We consulted with trade experts, who were also puzzled by Biden’s comments.

“The enforcement mechanisms in the original NAFTA were Investor State Dispute Settlement (ISDS), NAFTA arbitration panels to review countervailing duty and anti-dumping duty determinations, and various state-to-state consultation mechanisms,” said Gary Clyde Hufbauer, nonresident senior fellow at the Peterson Institute for International Economics and author of a book on NAFTA. “As you say, Clinton added the side agreements with weak enforcement — more akin to consultation — for environment and labor issues. Those side agreements were never promised or even contemplated by GHW Bush. And of course NAFTA was enacted under Clinton, not Bush. So Biden’s statement seems to be eliding the history of NAFTA.”

“Indeed, it was Clinton who formally proposed the side agreements as a condition to sign NAFTA, although it was a huge coalition of organizations which had demanded a North American charter that included human rights, labor and environmental protections,” said Isabel Studer, founding director of Sostenibilidad Global in Mexico, who has studied the side agreements in detail. “One of the problems is that none of the side agreements had enforcement mechanisms or teeth. This continued to be the main complaint of those opposing NAFTA. Only the investment chapter, chapter 11, did have enforcement mechanisms. This is why it is also known as the supranational clause on NAFTA. Any company could challenge a government for expropriation or acts tantamount to expropriation in international arbitration courts.”

Biden campaign officials noted that officials in the Bush administration had argued that NAFTA would give Mexico the resources to enforce its labor and environmental laws, implicitly suggesting this was an important element of the trade accord. (William Reilly, Bush’s chief of the Environmental Protection Agency, even argued it was the “greenest” trade agreement ever negotiated.) Moreover, they noted, leading environmental groups such as the National Audubon Society and National Wildlife Federation supported the Clinton side agreements. They argue that the side agreements laid the groundwork for tougher provisions in further trade agreements, including in the USMCA.

“Then-Senator Biden was against NAFTA as it was originally negotiated because he felt its provisions in their totality would not deliver the level of promised enforcement, or the progress with respect to labor and the environment that was also promised,” said campaign spokesman Andrew Bates. “After renegotiation and the addition of labor and environment side agreements, he believed those changes would enable the deal to live up to the vision that was sold. However, after implementation, it became clear that the enforcement results and side agreements were insufficient. During the George W. Bush Administration, then-Senator Biden was also concerned about lax trade enforcement overall. As such, he called for NAFTA to be renegotiated.”

[Update: Anthony Moran, who was analyst-in-charge for a Government Accountability Office (GAO) report covering the major issues surrounding NAFTA in 1993, contacted The Fact Checker with some additional nuance that he thought should mitigate the Pinocchio score. “While it is true that the Bush administration did not promise to include enforcement mechanisms for environment and labor issues in the negotiations, they did in fact agree to discuss environment and trade issues in the negotiations,” he wrote in an email. “They were forced to do so in exchange for a Congressional vote in 1991 to extend fast-track authority in order to complete the NAFTA negotiations. President Clinton subsequently initiated the side agreement negotiations, also to curry Congressional favor for NAFTA, but the enforcement element of those agreements was always oversold.”]

The Pinocchio Test

Biden left viewers with the impression that George H.W. Bush had promised to include enforcement of environmental and labor provisions in NAFTA. But Bush administration officials had only said NAFTA would give Mexico the resources to do so on its own.

Clinton did add side agreements on labor and environment, which lacked teeth but apparently were enough to win Biden’s vote on NAFTA. The record shows Biden certainly was prepared to cast a no vote until the side agreements were reached.

Biden jumbled the history from a quarter-century ago, exaggerating Bush’s commitments and the impact of the Clinton side agreements. He earns Two Pinocchios.

Two Pinocchios

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