House Lawmakers Move To Withdraw From NAFTA

In this election year, Democrats are having second thoughts about free trade. Some House members want to repeal NAFTA, the North American Free Trade Agreement with Canada and Mexico. And some Senators are worried about the stimulus bill sending or financing jobs overseas. Free trade may fly with economists, but it can be a hard sell on at home with near 10 percent unemployment.

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Finally, somebody is creating jobs - and people in Congress are furious because of where the jobs are. Lawmakers say federal stimulus dollars and trade policies are creating jobs overseas. That has led to calls for stronger buy- American provisions as well as the repeal of the North American Free Trade Agreement. NPR's David Welna reports on the outbreak of protectionist fever.

DAVID WELNA: This week, four Senate Democrats, led by New York's Charles Schumer, held a news conference at the Capitol.

INSKEEP: We're here today to discuss something so outrageous, it just makes your blood boil.

WELNA: The outrage, Schumer said, was that the Department of Energy was about to send a grant of nearly half a billion dollars in economic stimulus funds to a west Texas wind-farm project. He asserted the project would create a few hundred jobs in the U.S. - and 3,000 jobs in China.

INSKEEP: The stimulus is a golden opportunity, because it's dollars to buy those things and to say they have to be made here. China doesn't import our stuff when it's using its government's money. Why do we have to do that? Why are we sometimes, it seems, Uncle Sap, not Uncle Sam?

WELNA: Schumer said the problem was that Democrats forgot to include a buy- America clause for private firms receiving economic stimulus money. He called on the Obama administration to stop issuing grants until that loophole is closed. But administration officials dispute Schumer's allegations.

At a Senate hearing yesterday, Energy Secretary Steven Chu was asked about the west Texas wind-farm project.

INSKEEP: Although that has gotten a lot of press coverage, we have not gotten an application for a wind farm made with China parts in Texas.

WELNA: Cielo Wind Power is the west Texas firm that's building that wind farm. Its president, Walt Hornaday, says while the windmills will be assembled in China by maybe 100 workers, 70 percent of their content will be American, and the same goes for more than 2,000 workers on the project.

Hornaday says a buy-America provision is not needed.

M: It just simply sends the wrong signal on our industry where you're trying to fix a problem that doesn't exist. If you already have 70 percent U.S. content in turbines and 90 percent U.S. content in the balance of the project, what problem are you trying to fix?

WELNA: Meanwhile, a bill was introduced in the House yesterday that would have the U.S. withdraw from NAFTA. Three Republicans and 25 Democrats are co-sponsoring the measure, which effectively repeals the 16-year-old trade agreement with Canada and Mexico.

Mississippi Democrat Gene Taylor is leading the effort. He says with 10 percent unemployment, the U.S. can't afford a trade deal that he says is costing American jobs.

R: Remember, every single member of Congress is up for re-election in November. I guarantee you if the American people who know that this is a bum deal for America get riled up about it, we can repeal this.

WELNA: None of the anti-trade fervor on Capitol Hill surprises Linda Lim, of the University of Michigan's Ross School of Business. She's an expert on trade protectionism.

INSKEEP: It always rises to the fore when you have a bad economy. This is a standard response, particularly from politicians in an election year.

WELNA: Lim doubts this latest outbreak of protectionism will last, but it could well continue through November.

David Welna, NPR News, the Capitol.

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