Boxer, Feinstein help block Obama’s big trade initiative

President Obama speak at Nike headquarters in Beaverton, Ore., Friday, making a trade-policy pitch as he struggles to win over Democrats for what could be the last major legislative push of his presidency. President Obama speak at Nike headquarters in Beaverton, Ore., Friday, making a trade-policy pitch as he struggles to win over Democrats for what could be the last major legislative push of his presidency. Photo: Don Ryan / Associated Press Photo: Don Ryan / Associated Press Image 1 of / 3 Caption Close Boxer, Feinstein help block Obama’s big trade initiative 1 / 3 Back to Gallery

WASHINGTON — California’s two Democratic senators helped block President Obama’s big trade initiative Tuesday, dealing a stunning blow to their own party leader and his rare alliance with the new Senate Republican majority.

Sens. Dianne Feinstein and Barbara Boxer voted with all but one Democrat to halt consideration of trade promotion authority, a fast-track process that would restrict Congress to an up-or-down vote without amendment on new trade agreements, including the Trans-Pacific Partnership with Asia. It would be the biggest trade pact ever, covering 40 percent of the global economy.

The 52-45 vote in favor of halting the Democrats’ filibuster against the fast-track legislation fell far short of the 60 votes needed.

In a scathing speech on the Senate floor, Boxer said she had been “suckered” into supporting previous fast-track authority. It was an indication of how much Democrats have soured on trade deals since then-President Bill Clinton engineered the North American Free Trade Agreement, or NAFTA, with Mexico and Canada and brought China into the World Trade Organization during the 1990s.

Sudden downturn

Only a few weeks ago, the fast-track authority was expected to sail through the Senate. It passed with votes from seven Democrats last month in the Senate Finance Committee, including ranking Democrat Ron Wyden of Oregon. He voted “no” Tuesday, prompting accusations of betrayal from Republicans.

Senate Democrats’ opposition was also in contrast to the attitude of party leaders in the House, where Minority Leader Nancy Pelosi, D-San Francisco, has been saying for months that she hoped to “find a path to yes” with the administration on trade.

GOP vows to regroup

Shell-shocked Republicans said they would regroup, but given the breadth of Democratic opposition and handful of conservative GOP defections, their path forward is unclear.

Opponents argued that trade deals have eviscerated middle-class American jobs. Obama and Republicans countered that the new pacts being negotiated would improve protections for U.S. workers.

Intense White House lobbying included a visit last week to Nike headquarters in Oregon, where the athletic clothing company promised to return thousands of manufacturing jobs to the United States, but only if the Pacific pact was approved.

Nike hasn’t made a shoe in this country since 1984, and many analysts, including UC Berkeley’s Robert Reich, questioned whether the company was a good choice for the White House to showcase the benefits of free trade.

Reich, labor secretary under Clinton, said U.S. workers made only 1 percent of Nike products and that the company laid off a third of its U.S. workforce last year. He called Nike “a symbol of global sweatshop labor.”

Obama sought to bat down such criticism from his own party, engaging in sharp exchanges with, among others, Sen. Elizabeth Warren, a favorite of progressives. He labeled the Massachusetts Democrat’s arguments “absolutely wrong.”

Hillary Rodham Clinton, a longtime free-trade supporter who is also looking to whip up Democratic enthusiasm for her presidential campaign, stayed silent for weeks before finally saying she did not support “trade for trade’s sake.”

Business backing

Feinstein and Boxer bucked strong support for trade deals among California businesses, especially Silicon Valley and agriculture.

Boxer said she had come to regret giving former President Clinton fast-track authority for NAFTA.

NAFTA promoters promised 1 million new jobs, Boxer said, but she charged that the deal wound up costing 700,000 jobs, including 86,500 in California, as companies moved their manufacturing to Mexico. She said Mitsubishi officials had promised to keep making big-screen TVs in Santa Ana even after NAFTA, but within three years had relocated over the border.

Low-wage nations

Boxer said the Trans-Pacific Partnership pact would include nations such as Vietnam and Peru that have far lower wages than the United States.

“Tell me, what chance do our people who work in manufacturing have against countries paying less than $1 an hour?” Boxer said.

Feinstein had joined other Democrats in insisting that several other bills be included with the fast-track authority, including assistance for displaced U.S. workers and prohibitions against currency manipulation. China has come under particular criticism over the past decade for suppressing the value of its currency to make its exports artificially cheap.

Boxer also railed against the secrecy surrounding the contents of the Trans-Pacific pact. She said that before she could read the agreement, a guard ordered her to leave behind any electronic devices and told her she could take handwritten notes only if she surrendered them afterward.

“Not on your life,” Boxer said she told the guard. “God knows why this is ... classified. It has nothing to do with defense, nothing to do with going after ISIS.”

The administration is also negotiating a trade deal with Europe. But without fast-track authority shielding the negotiations from later changes by Congress, it will be difficult to close the deals.

Senate Majority Leader Mitch McConnell, R-Ky., said the rejection tells the rest of the world that “America can’t be depended upon.”

Carolyn Lochhead is The San Francisco Chronicle’s Washington correspondent. E-mail: clochhead@sfchronicle.com