Booting Trade; The Democrats have turned on the global free market, and that spells big trouble for Bush going forward.

Byline: Stephen Glain

It looked like another thumping for George W. Bush. He arrived in Vietnam for a trade summit last week empty-handed, having just lost his party's majority in Congress to the Democrats, who shot down the bilateral trade deal Bush had planned to present to his hosts in Hanoi. But if this seemed like the beginning of the Democrats' rebellion against a Republican president, it was as much a rejection of the free-trade legacy of the last Democratic president, Bill Clinton.

Going back to his days as governor of Arkansas, Clinton was an ardent free trader. As president, his embrace of trade co-opted a Republican policy preserve and retooled the Democrats as a centrist party. It was Clinton who pushed the North American Free Trade Agreement, despite opposition from organized labor. Clinton Treasury Secretary Robert Rubin emerged as a kind of metabureaucrat, wooing Wall Street wizards and Washington liberals alike with the gospel of the invisible hand guiding a beneficent free market. So unshakable was Clinton's faith in the power of unfettered trade that economists dusted off a term from the 1960s to explain it: neoliberalism.

Now the neoliberal creed has been largely washed away by a populist wave that equates trade with destruction, and not the creative kind. The U.S. offer to fully normalize trade relations with Vietnam died in large part due to impatient Republican leaders, who rushed it to a vote to coincide with Bush's Hanoi trip, with little time to rally support. It failed to gain the necessary two-thirds majority, with Democrats voting against 94 to 90, and became the first big trade measure ever to be rejected by Congress. The new anti-trade bias is likely to take a much firmer grip on the House of Representatives in January, when its new Democratic majority takes power.

During the campaign, Democrats railed against globalization as a boon to predatory capitalists and the root cause of job losses through outsourcing, stagnant wage growth and illegal immigration. They promised a moratorium on new trade deals, and already they're delivering. "There is a backlash against neoliberalism," says I. M. Desstler, a professor at the University of Maryland's School of Public Policy. "We have an economy where the dividends are unevenly distributed, and the easiest way to respond to it is to blame trade agreements."

The momentum behind this Democratic rebellion is striking. A month or so before the election, congressional aspirant Sherrod Brown of Ohio was dismissed as a fringe candidate for his fiercely antitrade views. His book "Myths of Free Trade: Why American Trade Policy Has Failed" is a populist-nationalist manifesto that debunks the Clintonian notion of free trade as good, inevitable and a well-established American tradition. Brown blasted NAFTA, the cornerstone of Clinton's neoliberal legacy, which he blames for plundering living standards continentwide. He ended up handily defeating incumbent Republican Mike DeWine with a 56 percent share of the vote.

Brown's victory makes him the flag bearer of the Democrats' new populism. Of the Democrats who won Republican House seats, according ...