Unions Steer Democrats Off Course

Every president loses a few votes in Congress and no one loss usually matters very much. Usually. But U.S. President Bill Clinton's latest defeat is no ordinary loss. He had asked Congress to renew the authority granted to every other president to negotiate trade treaties. In the early hours of Monday morning, he was forced to withdraw the request, as it became clear Congress would refuse if it came to a vote.

For any president, a loss on a trade vote would be a humiliating disaster: No president has lost an important trade vote since the Second World War. But for Clinton, the loss cut even deeper. This was a defeat handed him by his own party. Almost three-quarters of the Republicans in the House of Representatives were willing to entrust him with treaty-negotiating power. More than three-quarters of the members of his own Democratic party would not trust him.

In 1992, Clinton took on the job of transforming the out-of-date, sure-loser Democratic party of the 1980s into a modern political force. He wanted to liberate the Democrats from their thrall to reactionary trade union bosses and the ideological left, to save it from disaster by rebuilding it as a modern, outward-looking, middle-class political party. Clinton's staunch support for free trade -- anathema to both the unions and the left -- symbolized his determination to reinvent his party.

But after five years of Clinton, the Democratic party is more abjectly dependent on union money and support than at any time in the past 50 years. Bill Clinton won the 1996 election, in part, by ignoring U.S. campaign finance law. That helped him then. Now, as one scandal after another explodes around him, it has become incredibly difficult for Democrats to raise money. Who wants to give to a party notorious for being funded by hustlers, fugitives from justice and foreign gangsters? Failed fund-raising, the return of illegal campaign contributions and the cost of lawyers' fees have plunged the Democratic National Committee US$ 15 million in debt.

The shortage of money was one important reason for the terrible drumming the Democrats took in last Tuesday's
off-cycle elections. There were four important contests -- and they lost all four: the New York City mayor's race, the New Jersey governor's race, a special election to fill a Staten Island congressional vacancy, and the Virginia gubernatorial and state assembly election.

With the national committee broke and business donors refusing to return phone calls, and the 1998 elections only 12 months away, the average congressional Democrat is discovering the only source of funding he can still count on has become the unions. In the 1990s, union membership in the U.S. continues to shrink, but despite the dwindling of their followers, the union leaders are spending more money than ever on elections -- at least US$ 40 million in 1996 and quite possibly more, a huge sum even by the gigantic standards of U.S. politics. Plus, the unions can turn out volunteers to run phone banks, stuff envelopes and perform other services that would otherwise have to be paid for.
The president's scandals, in short, have delivered his party entirely into the hands of the union bosses. They pay the Democratic piper and so they can call the party's tune. And the tune they are calling is a protectionist one.

The bad news for the Democrats is while the unions are protectionist, the country is not. Since the early 1980s, a phalanx of politicians have convinced themselves that there might be political gains to be had from promising to drive imports off the U.S. market: Walter Mondale in 1984, Richard Gephardt, Michael Dukakis and Pat Robertson in 1988, Ross Perot, Pat Buchanan and Paul Tsongas in 1992, Ross Perot and Pat Buchanan in 1996. They all lost. Protectionism has aptly been called the 'fool's gold' of U.S. politics.

By swallowing the protectionist poison, the congressional Democrats of the 1990s are dooming themselves in exactly the same way the presidential Democrats of the 1980s doomed themselves. It was Clinton's aspiration to save his party from the union mossbacks, modernize it and make it an equal competitor to the Republicans. Monday's decision is the proof of how utterly he has failed -- and how much his own wrong doing is to blame.

Originally published in The Financial Post