SUDDENLY, AND quite improbably, free trade between the United States and tiny Panama is the hot issue on the Democratic side of the presidential campaign, with Sen. Bernie Sanders (I-Vt.) calling an Obama administration-backed tariff-slashing pact that took effect four years ago “a disaster.” His complaint is not the usual one about job-killing trade deals; after all, the United States has a multibillion-dollar trade surplus with Panama, just as it did before the pact. This time, Mr. Sanders blames the trade deal for Panama’s allegedly booming offshore banking business for wealthy international tax-avoiders, which has just been exposed in leaked records known as the Panama Papers.
“I predicted that the passage of this disastrous trade deal would make it easier, not harder, for the wealthy and large corporations to evade taxes by sheltering billions of dollars offshore,” Mr. Sanders said in a news release. “I wish I had been proven wrong about this, but it has now come to light that the extent of Panama’s tax avoidance scams is even worse than I had feared.” Quite a contrast, he says, with Hillary Clinton, who helped push the deal through Congress as Mr. Obama’s secretary of state.....