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. Last Updated: 07/27/2016

Nafta Feud: Class Conflict, American-Style

There are moments when American and Russian politics suddenly shift into patterns which remind us all just how similar these two vast countries can be. The intense debate over the controversial North American Free Trade Agreement is a classic example.


NAFTA, as it is now universally known, will slash tariffs to create free trade between the United States, Canada and Mexico. Although the United States will generate some 85 percent of it, this will be the world's biggest economic trading block, a richer market than the European Community. It also carries the prospect of further expansion into central and South America, with Chile and Argentina already lining up to join.


President Bill Clinton is for NAFTA, and so are all the previous living Presidents, all the former secretaries of state and national security advisers. All of America's Nobel Prize-winning economists support NAFTA, and so do the top businessmen of the major banks and corporations, and 41 of America's 50 state governors.


That is the problem, which helps explain why NAFTA is in such trouble in the U. S. Congress. The vote takes place on Nov. 17, one day before President Clinton flies to Seattle for his first Asian-Pacific economic summit. and unless something close to a political miracle takes place, Clinton will lose that vote, and arrive for his meetings with the leaders of Japan and China and the other Asian countries as a humiliated and diminished figure.


Clinton, who was elected last year promising to restore the fortunes of "America's forgotten middle class", finds himself on the wrong side of a class war. The people who are supporting NAFTA are America's elite, the academic economists, the big businessmen, the political classes and the posh newspapers, and the grander, more respectable environmental organizations. The people opposing NAFTA, because they fear that America will lose jobs to low-wage Mexico, are the non-elite, the trade unions and the populists like the consumer advocate Ralph Nader. Their rallying cry comes from Ross Perot, the Texan billionaire who won 19 percent of the presidential vote last year by telling people they could not trust the professional politicians of either party.


The Clinton administration fears defeat, and has been desperate enough to put up Vice President Al Gore to face Ross Perot, master of the sound-bite, in a televised debate on NAFTA. Al Gore, a son of a senator and a Harvard graduate, perfectly represents the American elite who believe NAFTA will be good for the country. But Ross Perot and the trade unions and the populists have the momentum, and may just have enough Democratic votes in Congress to win. Clinton admitted this week that he was still 30 Democratic votes short of passing NAFTA.


The class component of the NAFTA debate is America's echo of the arguments in Russia over shock therapy in economic reform. All the elites, from the Kremlin to the World Bank and IMF and businessmen, insist that shock therapy is good for the country. Trade unions and ordinary people who pay the social costs of unemployment and austerity have their doubts.


Karl Marx would appreciate the irony of these class dynamics that suddenly grip both the United States and Russia. and maybe, from that unguarded mausoleum in Red Square, one can hear a hollow laugh.