The New American Liberal: Guilt-Ridden and Nativist : Doctrine: NAFTA and the upsurge of immigrants have caught the left without many appealing solutions. But there is a way out.

Was it only a couple of years ago that California liberals almost uniformly favored open borders for capital and people? In those days, the idea that free trade could threaten the state was blithely dismissed. The North American Free Trade Agreement might imperil the fossilized economies of Pittsburgh and Detroit, but it merely opened new markets to the ever-expanding economy of the Golden State. As for the idea of restricting the flow of immigrants: If anyone had had the temerity even to raise it within the Democratic Party, with its increasingly Latino base and its staunchly civil-libertarian elite, it would quickly and surely have died for lack of a second.

Today, it would be more likely to pass by acclamation.

By mid-1992, the sea change among California Democrats was already apparent, and it reflected a broader shift in the national Democratic Party. A wave of immigrants and refugees was rolling over a stagnant global economy, and wherever business was slow and newcomers abundant, longtime proponents of liberal immigration policies and free trade were proclaiming the sanctity of borders.

For liberal Democrats, the populist attack on free trade, though it has its nativist component, should be the less of a problem. Since the 1930s, American liberals have not espoused free trade as a booster shot for the domestic economy, seeking instead to craft a mixed economy in which unions, the minimum wage, Social Security, etc., all worked to distribute income more equitably and to bolster purchasing power. The challenge for liberals today is to craft a position--of using trade accords to foster an international mixed economy--distinct from the more nativist anti-NAFTA sentiments.

If the Democrats should feel doctrinally comfortable opposing free trade, they should feel even more comfortable politically. Opposition to free trade unites the Democratic core constituencies, and support for it is far from overwhelming on the Democrats’ peripheries.

It’s the war on immigration that’s the more ideologically, politically and morally difficult for liberals. Few, if any, liberals, for example, would argue that endangered immigrants--refugees seeking political asylum, or a haven from a raging civil war--should be returned to their countries of origin. And yet, the spurned Haitian boat people were, above all, political refugees. The Salvadorans and Guatemalans, who flocked to Los Angeles in the ‘80s, fleeing civil strife would never had made it had the border been militarized, as some liberals now suggest.

The Democrats’ own moral ambivalence in these matters constitutes a rather slipshod brake against the rush to slam the doors. At the moment, the Democrats seem to be headed toward a combination of managed nativism and feelings of guilt.

How can liberals get through this nativist nightmare? Three perspectives--one analytic, one programmatic, one structural--can help shape the liberal response.

* The analytic . Immigration did not make this economy. Begin, though, by giving the devil his due: There are sectors of the economy where a native work force has been replaced by an immigrant one, bringing wage levels down with it. Building services and drywall construction are two such sectors.

Yet, the entire nation has been moving toward a lower-wage economy for decades, including sectors and regions unaffected by the immigrant influx. It is not the immigrants’ doing that technology is now dis-employing the service sector.

Indeed, the U.S. economy is coming to resemble the Mexican economy--but that’s much more the result of conscious choice by U.S. management than it is of the immigrant upsurge. One of the valid criticisms of NAFTA, for example, is that the side agreements don’t really mandate that productivity gains in Mexico go toward higher wages. But then, the link between productivity increases and higher wages has been broken in the United States, too. Twenty years of corporate violations of labor law, abetted by the pressures of a global economy, have reduced U.S. unions to a position not that much more powerful than that of their Mexican counterparts.

* The Programmatic . In “The New Dealers,” a history of the Franklin D. Roosevelt Administration, Jordan Schwartz contends that the New Deal was, in large part, a regional-development strategy: using federal power and federal funds to bring the roads and factories and industries to the then-underdeveloped South and West. Regional development placed a floor beneath the economy. As the economic gulf between a Mississippi and a Connecticut gradually closed, so did the possibility that one region of the nation’s economy could undercut another.

The same logic informs the managed-trade agreements of the European Community. As the nations of Western Europe moved toward free trade, they invested in their less-developed economic regions, the better to protect their own work forces. During the past decade, for example, the EC has spent $32 billion on projects in Spain, Portugal, Greece, Southern Italy and Ireland, and in the Iberian nations, at least, the resulting projects have substantially increased per capita income.

A program put together by the L.A-based Southwest Voter Research Project seeks similar results. It calls for substantial public investment on both sides of the border, and an agreement increasing workers’ rights. This is trade policy that derives from the New Deal tradition.

* The structural . Problem is, when it comes to the economy, all politics may not be local, but it’s certainly still national--though the economy has been transnational for two decades. What liberals are grappling with, directly in the case of NAFTA, obliquely in the case of immigration, is the fact that their greatest creation--the mixed economy--has been eroded by the globalized economy, and that there are precious few existing political structures to build a mixed economy (inherently a political creation) on a global scale. The EC is a model here, albeit an imperfect one, but it has no North American counterpart, and NAFTA fails to establish one. The Clinton Administration raised hopes that its side agreements with Mexico would create some mechanism for raising wages and living standards on both sides of the border. But the documents signed last week fall short of that.

Simply opposing NAFTA isn’t enough. Liberals must agitate for a NAMTA--a North American Managed Trade Agreement--that would establish international bodies to foster development, unionization and economic rights on both sides of the border. Politically, it would be useful if American liberals cultivated contacts with those elements in Mexico that are committed to building a cross-border mixed economy.

Neither this analysis nor this program nor this particular emphasis on international structures offers a magical solution to liberals as they grapple with the problems of open borders and public apprehensions. There are no magical solutions. But there are ways to think and talk about the international flows of capital and people that can free liberals from the cycle of reaction and remorse, and provide them with a better vehicle than the rickety jalopy of national politics as the global economy whizzes by.*