NAFTA Renegotiation Must Wait, Obama Says

President Warns Against Protectionism

By Michael D. Shear
Washington Post Staff Writer
Friday, February 20, 2009; A02

OTTAWA, Feb. 19 -- President Obama warned on Thursday against a "strong impulse" toward protectionism while the world suffers a global economic recession and said his election-year promise to renegotiate the North American Free Trade Agreement on behalf of unions and environmentalists will have to wait.

Obama made the comments as he stood with Canadian Prime Minister Stephen Harper during his first trip abroad as president. The two pledged cooperation on efforts to stimulate the economy, fight terrorism in Afghanistan and develop clean energy technology.

In a joint news conference, Obama said he wants to find a way to keep his campaign pledge to toughen labor and environmental standards -- and told Harper so -- but stressed that nothing should disrupt the free flow of trade between neighbors.

"Now is a time where we've got to be very careful about any signals of protectionism," the president said. "Because, as the economy of the world contracts, I think there's going to be a strong impulse on the part of constituencies in all countries to see if we -- they can engage in beggar-thy-neighbor policies."

The president's message served as a reminder of last year's private assessment by Canadian officials that then-candidate Obama's frequent criticism of NAFTA was nothing more than campaign speeches aimed at chasing support among Rust Belt union workers.

"Much of the rhetoric that may be perceived to be protectionist is more reflective of political maneuvering than policy," the Canadians concluded in a memo after meeting with Austan Goolsbee, a senior campaign aide and now a member of Obama's Council of Economic Advisers.

When the memo became public, Obama advisers rejected the idea as absurd and insisted that he was serious about changing NAFTA. Obama even suggested that the United States might opt out of NAFTA if the standards could not be improved to the nation's satisfaction.

But some longtime observers of the U.S.-Canada relationship said Obama's current position appears to confirm the impression that Canadian officials got from the meeting with Goolsbee.

"It sounds like [Goolsbee] was right," said former Massachusetts governor Paul Cellucci (R), who served as U.S. ambassador to Canada during George W. Bush's first term. "It looks like [President Obama has] softened that quite a bit, to put it mildly."

That could anger some of Obama's staunchest labor supporters, who blame NAFTA for sending American jobs oversees by not requiring a level playing field in the areas of labor and the environment.

But some of those allies said Thursday that they are giving the president more time to make good on his promise and praised Obama for finding a sophisticated way to express support for trade and changes to NAFTA.

"I am happy for him to frame his way of positioning the issue any way he wants, as long as he actually delivers on the issue," said Lori Wallach, the director of Public Citizen's Global Trade Watch division. "If down the road Obama doesn't deliver on the policy, there will be a whole lot of really upset people."

The trade discussion came as Canadians have expressed concern in recent days about the "Buy American" provision that Congress added to the $787 billion stimulus package that Obama signed into law this week.

Harper said he has "every expectation" that the United States will abide by trade rules that forbid such preferences. But he used strong language to indicate how seriously the country takes that issue.

"If we pursue stimulus packages, the goal of which is only to benefit ourselves, or to benefit ourselves, worse, at the expense of others, we will deepen the world recession, not solve it," he said.

Obama and Harper also pledged to work together to battle terrorism, especially in Afghanistan, where Canadian soldiers have been fighting and dying for years.

In his first public comments since sending an additional 17,000 troops to the war-torn country earlier this week, Obama said that "it was necessary to stabilize the situation there in advance of the elections that are coming up."

The president declined to say how long the troops will remain there, citing a 60-day review he has ordered. Harper also declined to say whether his country's troops will remain beyond 2011, but said the long-term goal of the war should be constrained.

"We are not in the long term, through our own efforts, going to establish peace and security in Afghanistan. That, that job, ultimately, can be done only by the Afghans themselves," he said.

The president's trip to Canada was a traditional visit early in his term. The snow may have subtly reminded him of campaigning in the Midwest, as he said he was pleased "to be here in Iowa -- Ottawa."

He disappointed many Canadians who had hoped to see him at a public event. Instead, he waved briefly to a crowd of about 2,000 waiting in the snow as he walked to his meetings.

He did surprise reporters with a brief stop at a converted indoor farmers market in a historic stretch of Ottawa afterward. He bought a keychain with Canadian currency, telling reporters that he was continuing a tradition of buying knickknacks when he travels.

Obama and Harper also pledged cooperation to revive North America's closely linked economy and signed an agreement to work toward developing clean energy technology.

"It will advance carbon reduction technologies. And it will support the development of an electric grid that can help deliver the clean and renewable energy of the future to homes and businesses, both in Canada and the United States," Obama said.

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