Vermont Sen. Bernie Sanders is running for the Democratic presidential nomination against Hillary Clinton, but in many ways, he’s also running against her husband’s presidential legacy.
Sanders rails against the North American Free Trade Agreement – which Bill Clinton pushed into law.
Sanders thinks that just like NAFTA, free trade with China has been a job-killer, but Bill Clinton lobbied for it and, in 2000, Hillary Clinton supported it en route to election to the U.S. Senate.
And Sanders argued as far back as 1999 that deregulating the financial industry could lead to a federal bank bailout – but Bill Clinton backed the deregulation.
Bill Clinton – who was scheduled to campaign on his wife’s behalf in Depew on Tuesday – long has been known as one of America’s great campaigners, but in this 2016 race for the Democratic presidential nomination, he’s something more.
He’s a Democratic president with a moderate track record that Sanders sometimes eviscerates without naming him. And he’s both a blessing and a burden to Hillary Clinton as the former secretary of state finds herself moving leftward with her party – especially on trade – and away from her husband’s centrist legacy.
The gap between Sanders, a self-avowed democratic socialist, and Bill Clinton, the self-avowed “new Democrat,” is nothing new.
All the way back in 1995, Sanders wrote a harsh assessment of Bill Clinton’s middle-of-the-road tendencies in “In These Times,” a left-leaning magazine. “Has he tried to build a political movement that would empower working people so they could make real improvements in their lives? Absolutely not,” Sanders wrote.
Then and now, the gap between Sanders’ beliefs and Bill Clinton’s record seems most stark on the issue of free trade.
In 1995, for example, Sanders said Bill Clinton favored free trade “to placate corporate America.”
And on the presidential campaign trail two decades later, Sanders looks back at NAFTA and “Permanent Normal Trade Relations” with China and says, in essence, I told you so.
“Trade deals like the North American Free Trade Agreement (NAFTA), the Central American Free Trade Agreement (CAFTA) and the granting of Permanent Normal Trade Relations to China have been abysmal failures,” Sanders wrote in an op-ed article last year. “They allowed corporations to shut down operations in the U.S. and move work to low-wage countries where people are forced to work for pennies an hour; and they are one of the reasons that we have lost almost 60,000 factories in our country and millions of good-paying jobs since 2001.”
Studies on NAFTA’s impact tend to conflict. Sanders cites a report from the left-leaning Economic Policy Institute that says the trade deal with Canada and Mexico cost 800,000 American jobs, but a report from the Congressional Research Service called NAFTA’s impact “relatively modest.”
More definitively, the Federal Reserve issued a report in 2013 that showing that free trade with China cost America about 4 million manufacturing jobs.
“Absent the shift in U.S. policy, U.S. manufacturing employment would have risen nearly 10 percent between 2001 and 2007, versus an actual decline of more than 15 percent,” the authors of the Fed study wrote.
That’s not what either Bill or Hillary Clinton predicted.
Bill Clinton called a congressional vote ratifying the China trade deal “a vote for our economic security.”
And Hillary Clinton said on CNN in 2007: “On balance, I’ve looked at this, I’ve studied it, I think it is in the interests of America and American workers that we provide the option for China to go into the WTO (World Trade Organization).”
Given the gap between Bill Clinton’s pro-trade history and growing skepticism about free trade in the American public, perhaps it’s no surprise that Hillary Clinton – who said in 1996 that “NAFTA is proving its worth” – has been moving away from free trade. She criticized NAFTA during her 2008 campaign and continues to do so now.
In her 2014 memoir “Hard Choices,” she lashed into China for manipulating its currency and otherwise abusing the privilege of its membership in the WTO.
And after supporting the Trans Pacific Partnership, – a trade deal with 11 Pacific Rim nations – as secretary of state, she turned against it once the final version was negotiated.
“We have failed to provide the basic safety net support that American workers need in order to be able to compete and win in the global economy,” Hillary Clinton said in a February debate.
Sanders has been consistently opposed to the Trans Pacific Partnership – just as he has been consistently opposed to another key part of Bill Clinton’s legacy: financial reform.
At Bill Clinton’s behest, Congress in 1999 repealed the Depression-era Glass-Steagall Act, which prohibited banks from selling stocks and investment firms from taking deposits.
“What we are doing is modernizing the financial services industry, tearing down these antiquated laws and granting banks significant new authority,” President Clinton said at the time.
Then-Rep. Bernie Sanders couldn’t have disagreed more. “I wonder what happens when you are going to have fewer and fewer financial institutions who, if in a dangerous financial situation, are going to call upon the United States government and the taxpayers of this country to bail them out,” Sanders said at a congressional hearing in 1999. “We’re not going to have the resources to do that.”
Actually, the government borrowed the resources to do that during the financial crisis of 2008.
Now, 17 years later, Sanders wants to reinstitute Glass-Steagall and break up the nation’s big banks.
And Hillary Clinton – siding with most economists – offers a more nuanced approach to Wall Street reform.
“My plan proposes legislation that would impose a new risk fee on dozens of the biggest banks – those with more than $50 billion in assets – and other systemically important financial institutions to discourage the kind of hazardous behavior that could induce another crisis,” she said in a New York Times op-ed.
Hillary Clinton argues that the repeal of Glass-Steagall did not cause the financial crisis, and many economists and other experts agree. Instead they put the blame on the Commodities Futures Modernization Act of 2000, which deregulated credit default swaps and other exotic financial instruments tied to the Great Recession.
In retrospect, those deregulated instruments became “the fuel for what has become a global credit crisis,” Christopher Cox, chairman of the Securities and Exchange Commission under President George W. Bush, told Congress.
But the Commodities Futures Modernization Act, to paraphrase the political cliché, also made for strange bedfellows. Then-Rep. Bernie Sanders voted for the bill. And President Bill Clinton signed it.