Senate Panel Narrowly Endorses CAFTA

A Senate committee on Wednesday approved a trade agreement with Latin American nations, moving Congress a step closer to a decision on an accord that may have minimal effects on the U.S. economy but is of considerable political import to the Bush administration.

The Finance Committee approved the agreement by a voice vote, although it was closely divided on the issue. The bill now goes to the full Senate for a vote as early as this week. Passage in the Senate, traditionally more sympathetic to trade agreements, could give the measure some momentum in the House, where there is stiffer opposition.

The Central American Free Trade Agreement, or CAFTA, would end trade barriers now encountered by U.S. goods in Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic. It also would ease investment rules, strengthen protections for intellectual property and, according to supporters, solidify economic and democratic stability in the region.

But the agreement has run into vigorous opposition from labor groups, and their Democratic allies, who say its provisions on labor rights are weak, and from the U.S. sugar industry, which claims that an increase in Central American imports, while small, could open the door to ruin.

Sen. Jeff Bingaman (news, bio, voting record), D-N.M., a key undecided vote on the Finance Committee, announced he was supporting the pact after the administration answered some of his concerns about the "serious lack of attention to the enforcement of worker rights."

He said he had pledges of an extra $40 million over four years to promote labor laws. The administration also told him it will spend $30 million over five years to help subsistence farmers in three Central American countries who might be displaced by an increase in U.S. agriculture imports.

The Bush administration has waged a relentless lobbying effort in the past month. President Bush invited all six CAFTA presidents to the White House and hailed the agreement in several recent speeches to Hispanic-American and other groups. U.S. Trade Representative Rob Portman (news, bio, voting record) and Agriculture Secretary Mike Johanns are constantly on Capitol Hill, talking to undecided lawmakers.

Johanns met Monday with senators and representatives of the sugar industry, and again on Tuesday with lawmakers, to discuss proposals to assure that CAFTA will not undermine the industry's future viability. Those plans included the government buying up increased sugar cane imports from Central America to be used in the production of ethanol.

Republican Sen. Craig Thomas (news, bio, voting record), whose state of Wyoming has a large sugar beet industry, told the Finance Committee that "it distresses me a little" that only now, when a final vote on CAFTA is looming, is the administration getting serious about the sugar issue.

But Sen. Trent Lott (news, bio, voting record), R-Miss., suggested that there could be repercussions for the industry, always well-protected by Congress, if it succeeded in scuttling the agreement. "This could be devastating to them if not handled right," he said.

The top Democrat on the committee, Sen. Max Baucus (news, bio, voting record) of sugar beet-growing Montana, opposes CAFTA, breaking with his usual support of trade agreements.

In addition to saying that the agreement was bad for the sugar industry, he criticized the administration for rejecting a proposal to help U.S. service industry workers who lose their jobs because of foreign competition and for not consulting more with Congress.

From Ron Paul's weekly column, Texas Straight Talk
http://www.house.gov/paul/tst/tst2005/tst060605.htm

CAFTA: More Bureaucracy, Less Free Trade

June 6, 2005

The Central America Free Trade Agreement, known as CAFTA, will be the source of intense political debate in Washington this summer. The House of Representatives will vote on CAFTA ratification in June, while the Senate likely will vote in July.

I oppose CAFTA for a very simple reason: it is unconstitutional. The Constitution clearly grants Congress alone the authority to regulate international trade. The plain text of Article I, Section 8, Clause 3 is incontrovertible. Neither Congress nor the President can give this authority away by treaty, any more than they can repeal the First Amendment by treaty. This fundamental point, based on the plain meaning of the Constitution, cannot be overstated. Every member of Congress who votes for CAFTA is voting to abdicate power to an international body in direct violation of the Constitution.

We don’t need government agreements to have free trade. We merely need to lower or eliminate taxes on the American people, without regard to what other nations do. Remember, tariffs are simply taxes on consumers. Americans have always bought goods from abroad; the only question is how much our government taxes us for doing so. As economist Henry Hazlitt explained, tariffs simply protect politically-favored special interests at the expense of consumers, while lowering wages across the economy as a whole. Hazlitt, Ludwig von Mises, Friedrich Hayek, Murray Rothbard, and countless other economists have demolished every fallacy concerning tariffs, proving conclusively that unilateral elimination of tariffs benefits the American people. We don’t need CAFTA or any other international agreement to reap the economic benefits promised by CAFTA supporters, we only need to change our own harmful economic and tax policies. Let the rest of the world hurt their citizens with tariffs; if we simply reduce tariffs and taxes at home, we will attract capital and see our economy flourish.

It is absurd to believe that CAFTA and other trade agreements do not diminish American sovereignty. When we grant quasi-governmental international bodies the power to make decisions about American trade rules, we lose sovereignty plain and simple. I can assure you first hand that Congress has changed American tax laws for the sole reason that the World Trade Organization decided our rules unfairly impacted the European Union. Hundreds of tax bills languish in the House Ways and Means committee, while the one bill drafted strictly to satisfy the WTO was brought to the floor and passed with great urgency last year.

The tax bill in question is just the tip of the iceberg. The quasi-judicial regime created under CAFTA will have the same power to coerce our cowardly legislature into changing American laws in the future. Labor and environmental rules are inherently associated with trade laws, and we can be sure that CAFTA will provide yet another avenue for globalists to impose the Kyoto Accord and similar agreements on the American people. CAFTA also imposes the International Labor Organization’s manifesto, which could have been written by Karl Marx, on American business. I encourage every conservative and libertarian who supports CAFTA to read the ILO declaration and consider whether they still believe the treaty will make America more free.

CAFTA means more government! Like the UN, NAFTA, and the WTO, it represents another stone in the foundation of a global government system. Most Americans already understand they are governed by largely unaccountable forces in Washington, yet now they face having their domestic laws influenced by bureaucrats in Brussels, Zurich, or Mexico City.

CAFTA and other international trade agreements do not represent free trade. Free trade occurs in the absence of government interference in the flow of goods, while CAFTA represents more government in the form of an international body. It is incompatible with our Constitution and national sovereignty, and we don’t need it to benefit from international trade.

YOU SAID..."free trade vs expanding government to block the actions of private citizens and porkbarrel it."

Are you saying that CAFTA is just a bunch of private citizens free tradin' with other private citizens?

Ive read through some of the documentation on this...I see mention of government and international government agencies involving in setting up this agreement...and enforcing it. After all...it is being voted on in GOVERNMENT... as we speak.

This IS THE GOVERNMENT....not only in the US but in all of those little countries where the government has alot more control over private citizens than it has in the US.

BTW... as far as your comment on protecting American jobs...you will be pleased to learn that in all the documentation I read...no mention of protection of American jobs was evident.

HOWEVER... that was NOT the case for all of those poor people over on the other side of the fence in Central America. I read page after page of special exemptions and considerations given to protect the jobs and the 'system' of those folks in those 'other' countries.

So much for philosophy....lets talk reality.

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