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WASHINGTON-To court blue-collar workers, Sens. Hillary Clinton and Barack Obama have spent months bashing NAFTA, the landmark trade deal that dropped barriers between Canada, Mexico and the United States.
Each candidate wants to change the North American Free Trade Agreement to help American workers who have seen manufacturing jobs slip across the country's Southern border. And each candidate has accused the other of initially supporting NAFTA, only to flip flop after deciding to run for president.
As the economy continues to sour, trade policy - and its impact on workers - has emerged as a key issue in the Democratic contest.
But the emotional NAFTA-focused debate has largely drowned out discussion of what economists say is a more pertinent trade issue in many states, including North Carolina, which holds its primary next week. That issue is trade with China.
Chinese imports of everything from cheap televisions to socks have skyrocketed since 2001, when the emerging economic power joined the World Trade Organization.
China's admission to WTO was backed by both the Bush and Clinton administrations. It gave China virtually unfettered access to the U.S. market, making it easy for Americans to buy cheap Chinese products. It also hastened the decline of domestic manufacturers who once made the couches, T-shirts and other goods China now supplies.
In North Carolina, NAFTA hurt, but the blow struck by Chinese imports has been greater. During the first seven years of NAFTA, which took effect in 1994, the state lost 26,000 manufacturing jobs. In the first four years after China entered the WTO, the state lost 30,000 jobs in textile, apparel and furniture manufacturing alone, according to the U.S.-China Economic and Security Review Commission.
And that trend has continued. According to the Economic Policy Institute, a non-partisan think tank, the open-door China policy has cost North Carolina 77,000 jobs since 2001, about 2 percent of the state's total employment during that period. That's a higher percentage than any state but New Hampshire.
Despite the job losses, free-trade advocates maintain that the open-door policy with China has fostered international expansion of North Carolina companies, particularly biotech and software firms.
Exports from North Carolina companies to China have grown over the last five years - but not nearly as fast as imports from China.
The U.S. trade deficit with China has ballooned to $256 billion from $83 billion in 2001, despite early predictions that free trade would help shrink it. On balance, China's entrance into the WTO has been bad for North Carolina, a 2007 report by the U.S.-China commission concluded.
"North Carolina appears to have realized few if any substantial benefits from China's admission to the WTO, and the net effect of trade with China since its accession appears to be negative overall for North Carolina's economy," the report said.
When Dennis Martin goes to the polls Tuesday, trade policy will be second only to gun control. He owns a sock factory in Hickory, one of the few left of the state's once-thriving footwear industry.
NAFTA didn't put Martin out of business. But he expects to close soon, because of a recent spike in imports from China and, after the passage of the Central American Free Trade Agreement in 2005, from Honduras. Clinton and Obama both voted against CAFTA.
"With every little trade deal, we've been chipped away at bit by bit," Martin said, adding that he would like to hear more from the candidates about China on the campaign trail and less about NAFTA. Martin plans to vote for Obama.
On most trade issues, Clinton and Obama sound quite similar. Both candidates have said that as president they would seek to retool WTO agreements to help American workers.
But as with NAFTA, each candidate made statements before running for president that the rival campaign has interpreted as being overly supportive of unfettered trade with China.
In 1999, President Bill Clinton signed legislation granting China permanent normalized trade status, which paved the way for the country's entry into the WTO.
As a Senate candidate in 2000, Hillary Clinton told CNN that "on balance...I think it is in the interests of America and American workers that we provide the option for China to go into the WTO."
The Clinton campaign has interpreted a far less direct statement by Obama in 2007 to mean he once supported current trade restrictions under the WTO. He said then that it was important for the country to negotiate trade deals recognizing that the "global economy has shifted."
Today, though, both take a similar, hard line against Chinese imports. Both say they would be more aggressive than the Bush administration in enforcing violations of existing trade agreements and rework trade deals to include basic labor and environmental standards. Chinese goods cost less because workers there earn less and environmental regulations are lax.
Another reason that their goods are cheaper: the Chinese set the value of their currency artificially lower than most economists think it is actually worth. Both Obama and Clinton want the practice stopped.
The monetary policy makes Chinese products sold in the United States cheaper, and U.S. products sold in China more expensive.
Jeff Faux, a fellow at the Economic Policy Institute and author of "The Global Class War," said he understands why NAFTA has become a bigger issue than China on the campaign trail.
As the first major hemispheric trade agreement of the 1990s, NAFTA became shorthand for the larger debate over international trade, "both symbol and substance," Faux said.
"To some degree, it's become a proxy for the whole shmear, including China," he said.
Also, he hypothesized, the candidates are thinking past Inauguration Day. Though renegotiating NAFTA would be difficult, he said, our relationship with China and other WTO countries make that task seem simple by comparison.
Americans have become dependent on cheap Chinese goods. And the United States is deeply in debt to China, giving that nation more leverage over the United States than Canada or Mexico.
"You have to be careful when you are threatening your banker," he said.
Sean Mussenden can be reached at smussenden@mediageneral.com or 202-662-7668.
Each candidate wants to change the North American Free Trade Agreement to help American workers who have seen manufacturing jobs slip across the country's Southern border. And each candidate has accused the other of initially supporting NAFTA, only to flip flop after deciding to run for president.
As the economy continues to sour, trade policy - and its impact on workers - has emerged as a key issue in the Democratic contest.
But the emotional NAFTA-focused debate has largely drowned out discussion of what economists say is a more pertinent trade issue in many states, including North Carolina, which holds its primary next week. That issue is trade with China.
Chinese imports of everything from cheap televisions to socks have skyrocketed since 2001, when the emerging economic power joined the World Trade Organization.
China's admission to WTO was backed by both the Bush and Clinton administrations. It gave China virtually unfettered access to the U.S. market, making it easy for Americans to buy cheap Chinese products. It also hastened the decline of domestic manufacturers who once made the couches, T-shirts and other goods China now supplies.
In North Carolina, NAFTA hurt, but the blow struck by Chinese imports has been greater. During the first seven years of NAFTA, which took effect in 1994, the state lost 26,000 manufacturing jobs. In the first four years after China entered the WTO, the state lost 30,000 jobs in textile, apparel and furniture manufacturing alone, according to the U.S.-China Economic and Security Review Commission.
And that trend has continued. According to the Economic Policy Institute, a non-partisan think tank, the open-door China policy has cost North Carolina 77,000 jobs since 2001, about 2 percent of the state's total employment during that period. That's a higher percentage than any state but New Hampshire.
Despite the job losses, free-trade advocates maintain that the open-door policy with China has fostered international expansion of North Carolina companies, particularly biotech and software firms.
Exports from North Carolina companies to China have grown over the last five years - but not nearly as fast as imports from China.
The U.S. trade deficit with China has ballooned to $256 billion from $83 billion in 2001, despite early predictions that free trade would help shrink it. On balance, China's entrance into the WTO has been bad for North Carolina, a 2007 report by the U.S.-China commission concluded.
"North Carolina appears to have realized few if any substantial benefits from China's admission to the WTO, and the net effect of trade with China since its accession appears to be negative overall for North Carolina's economy," the report said.
When Dennis Martin goes to the polls Tuesday, trade policy will be second only to gun control. He owns a sock factory in Hickory, one of the few left of the state's once-thriving footwear industry.
NAFTA didn't put Martin out of business. But he expects to close soon, because of a recent spike in imports from China and, after the passage of the Central American Free Trade Agreement in 2005, from Honduras. Clinton and Obama both voted against CAFTA.
"With every little trade deal, we've been chipped away at bit by bit," Martin said, adding that he would like to hear more from the candidates about China on the campaign trail and less about NAFTA. Martin plans to vote for Obama.
On most trade issues, Clinton and Obama sound quite similar. Both candidates have said that as president they would seek to retool WTO agreements to help American workers.
But as with NAFTA, each candidate made statements before running for president that the rival campaign has interpreted as being overly supportive of unfettered trade with China.
In 1999, President Bill Clinton signed legislation granting China permanent normalized trade status, which paved the way for the country's entry into the WTO.
As a Senate candidate in 2000, Hillary Clinton told CNN that "on balance...I think it is in the interests of America and American workers that we provide the option for China to go into the WTO."
The Clinton campaign has interpreted a far less direct statement by Obama in 2007 to mean he once supported current trade restrictions under the WTO. He said then that it was important for the country to negotiate trade deals recognizing that the "global economy has shifted."
Today, though, both take a similar, hard line against Chinese imports. Both say they would be more aggressive than the Bush administration in enforcing violations of existing trade agreements and rework trade deals to include basic labor and environmental standards. Chinese goods cost less because workers there earn less and environmental regulations are lax.
Another reason that their goods are cheaper: the Chinese set the value of their currency artificially lower than most economists think it is actually worth. Both Obama and Clinton want the practice stopped.
The monetary policy makes Chinese products sold in the United States cheaper, and U.S. products sold in China more expensive.
Jeff Faux, a fellow at the Economic Policy Institute and author of "The Global Class War," said he understands why NAFTA has become a bigger issue than China on the campaign trail.
As the first major hemispheric trade agreement of the 1990s, NAFTA became shorthand for the larger debate over international trade, "both symbol and substance," Faux said.
"To some degree, it's become a proxy for the whole shmear, including China," he said.
Also, he hypothesized, the candidates are thinking past Inauguration Day. Though renegotiating NAFTA would be difficult, he said, our relationship with China and other WTO countries make that task seem simple by comparison.
Americans have become dependent on cheap Chinese goods. And the United States is deeply in debt to China, giving that nation more leverage over the United States than Canada or Mexico.
"You have to be careful when you are threatening your banker," he said.
Sean Mussenden can be reached at smussenden@mediageneral.com or 202-662-7668.