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News :: Agriculture : Civil & Human Rights : Economy : Elections & Legislation : Environment : Globalization : Government Secrecy : International Relations : Labor : Latin America : Political-Economy : Regime |
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The Hidden Pages of CAFTA |
Current rating: 0 |
by Liza Grandia
(No verified email address) |
27 Jul 2005
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At 2,400 pages, the Central America Free Trade Agreement (CAFTA) isn't really about trade. Frankly, you don't need 2,400 pages to eliminate tariffs and regulations on exports and imports. But, you might need 2,400 pages to smuggle through a new set of transnational corporate rights disguised by complicated legalese. I wonder, how many of our Congressional representatives will have even attempted to read this trade to me before next week's vote? |
At 2,400 pages, the Central America Free Trade Agreement (CAFTA) isn't really about trade. Frankly, you don't need 2,400 pages to eliminate tariffs and regulations on exports and imports. But, you might need 2,400 pages to smuggle through a new set of transnational corporate rights disguised by complicated legalese. I wonder, how many of our Congressional representatives will have even attempted to read this trade to me before next week's vote?
I recall in 1994 that only one senator Republican; Hank Brown (R-CO), accepted Ralph Nader's challenge to win $10,000 for charity by taking a simple ten-question quiz on the content of the World Trade Organization (WTO) agreement. After studying the agreement, Brown announced to the press: "I am a Republican, pro business and a proponent of the free market economy and I am here to speak out against the WTO. For when you read this text - and I invite my colleague senators to do this - you will understand that the WTO is fundamentally undemocratic."
Any naĂŻve Congressperson who thinks CAFTA is merely about free trade should look carefully at its provisions on government contracts and corporate lawsuits, among others.
Government contracts. For any purchases over $117,000 (eventually to be lowered to $58,000), CAFTA forces governments to open up bidding to transnational corporations. That means that states will not longer be able to give preference to home-based businesses, and so mom and pop stores in Central America and the U.S. will suddenly be competing with the Bechtels and the Halliburtons of the world.
Corporate lawsuits against governments. Perhaps CAFTA's most worrisome provision expands the rights that corporations got under NAFTA to sue national governments over any laws perceived as barriers to trade and foreign investment. For instance, when California banned a carcinogenic gasoline additive called MTBE because it was seeping into the state's drinking water, the chemical manufacturer, Methanex, sued California for infringing on its trade rights under NAFTA and demanded $970 million in compensation. Such suits are a direct threat to democracy because they prioritize the profits of foreign corporations over a country's own environmental, social, and labor laws.
Already corporations are planning more such lawsuits. If CAFTA passes, a subsidiary of Harken Energy (on whose board George W. Bush once served) has said it will demand $58 billion from Costa Rica (whose entire GDP is only $37 billion) in compensation for hypothetical future lost profits, if they are not allowed to drill offshore in Costa Rica's protected Talamanca region--one of the planet's richest marine ecosystems, and a UNESCO World Heritage Site.
CAFTA also encourages privatization, especially for government services in health, water, energy, and social security. In agriculture, it will allow transnational agribusiness cartels to dump food commodities at below-market prices. It will forbid the public health sector from buying life-saving generic drugs for diseases like AIDS.
Upon close examination, one realizes that CAFTA is not a "free trade" agreement, but a corporate trade agreement that transforms foreign investment from a privilege to an inalienable right.
CAFTA is like having a house guest who cleans out your refrigerator, claims your nicest bed, spends hours in the bathroom, takes exclusive control of the television remote control, and then-like Paris Hilton-demands that you pay for the pleasure of her company and then writes you off as a business expense.
There are alternatives. If the U.S. is serious about strengthening economic ties with our closest neighbors, we could take a Common Market approach like Mercosur or the European Union. Europe opened up not only trade, but also labor markets to the lesser-developed regions of Europe. And, to help poorer member countries like Ireland become equal trading partners, the E.U. gives back 3.5% of Ireland's GDP in grants.
In the meanwhile, the U.S. has a perfectly sound trade agreement with Central America called the Caribbean Basin Initiative, which already makes most of our trade with Central America duty free. Congress should defeat CAFTA and send the Bush administration back to negotiate a real trade agreement that every U.S. and Central American citizen can read in less time than the pages of King James version of the Bible and Gone With the Wind combined.
Liza Grandia is an anthropologist who has lived and worked in Guatemala for more than six years. Her dissertation concerns the impacts of trade and globalization on the agrarian situation of the Q'eqchi' Maya people. |
See also:
http://www.commondreams.org
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Copyright by the author. All rights reserved. |
Comments
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Tim Johnson Sold Your Job Out |
by tired of Tim
(No verified email address) |
Current rating: 0
28 Jul 2005
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I just wanted to note that when your job goes overseas, be sure and remember U.S. Rep. Tim Johnson at the ballot box in the 2006 election. He voted in favor of CAFTA -- and like most in Congress who voted in favor of CAFTA, he no doubt voted that way because he was told to do so, not because he'd read and understood what CAFTA is really all about. Or maybe he knows that CAFTA is nothing but a corporate giveaway and just doesn't have the guts to say that is why he voted for it. |
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Passage of CAFTA Bad News for Farmers |
by Institute for Agriculture and Trade Policy
(No verified email address) |
Current rating: 0
28 Jul 2005
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Press Release from the Institute for Agriculture and Trade Policy
July 28, 2005
Contact: Ben Lilliston, 612-870-3416, blilliston (at) iatp.org
Passage of CAFTA Bad News for Farmers
Minnesota and Central American Farmers Stand to Lose
Minneapolis - The passage of the Central America Free Trade Agreement (CAFTA) in the U.S. House of Representatives late last night signals a major setback for U.S. sugar farmers and a damaging blow to Central American farmers, said the Institute for Agriculture and Trade Policy (IATP). The deal would lead to the destruction of the U.S. sugar program, and increase agricultural dumping of agricultural commodities below their cost of production into Central American countries.
“There’s no question that sugar farmers are being sacrificed on the altar of free trade,” said R. Dennis Olson, director of IATP’s Trade and Agriculture Project. “We’ve seen the so-called `free trade’ model fail farmers and rural communities for the last 10 years under the North American Free Trade Agreement. This is another bad trade deal filled with false promises for farmers and workers in all the participating countries.”
As part of ushering CAFTA through the Senate, Minnesota Senator Norm Coleman negotiated a poorly conceived “sugar deal” with the White House that purported to help protect sugar farmers by curbing sugar imports. But the deal would only limit sugar imports for two years, until the 2007 farm bill is completed. And its methods for controlling increased sugar imports would likely lead to either increased dumping of under-priced U.S. crops to CAFTA countries or diverting sugar to compete with homegrown corn-based ethanol operations.
Since the announcement of the Coleman plan, two government reports have raised serious questions. The non-partisan Congressional Research Service questioned whether the U.S. Department of Agriculture has the legal authority to implement the deal and keep imported sugar off the U.S. market. And the non-partisan Congressional Budget Office (CBO) estimated that the CAFTA agreement would cost U.S. taxpayers $50 million a year in loan forfeitures by sugar farmers.
The CBO estimate is consistent with a report published by IATP earlier this year that found that increased sugar imports required by CAFTA would threaten the viability of the U.S. sugar program. The IATP report concluded that when combined with North American Free Trade Agreement (NAFTA) commitments made with Mexico and other trade agreements on the table, CAFTA would seal the fate of U.S. sugar growers, and lower prices for sugar growers in poor countries as well.
Over 32,000 people depend on the sweetener industry for their livelihoods in the upper Midwest. Minnesota, North Dakota and Montana rely on $62 million in state tax revenues generated annually by this industry.
The combined economies of CAFTA nations are less than half the size of the economy of the Metro Minneapolis area, according to the U.S. Conference of Mayors’ Metro Economies Report. The Bush Administration’s own International Trade Commission (ITC) projects that any gains in overall exports to CAFTA countries ($2.7 billion) would be negated by increased imports ($2.8 billion).
“These are not big export markets with high wage consumers ready to buy U.S. products,” said Olson. “It’s a real stretch to make the case that this deal will benefit any farmers. But it’s easy to see how it will hurt U.S. sugar farmers, and push Central American farmers off the land.”
CAFTA would force Central American countries to dismantle border protections against agricultural imports dumped into their markets at below cost by U.S. multinational agribusinesses. If CAFTA dismantles these protections, the U.S. could experience another wave of forced immigration of small farmers similar to when NAFTA forced 1.5 million Mexican farmers from their land with increased imports of dumped U.S. corn and other commodities. The Bush administration admitted as much in a promise to send additional funds to CAFTA countries for "rural development assistance,” which will be needed to mitigate the anticipated eviction of small Central American farmers from their land.
IATP has issued three papers on the impact of CAFTA on farmers in the U.S. and in CAFTA countries: Sweet or Sour? The U.S. Sugar Program and the Threats Posed by DR-CAFTA; CAFTA’s Impact on the U.S. Ethanol Market; and Analysis of CAFTA Concerning Agriculture. All three papers can be found at: http://www.tradeobservatory.org.
The Institute for Agriculture and Trade Policy works globally to promote resilient family farms, communities and ecosystems through research and education, science and technology, and advocacy. |
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Pleas and Promises by G.O.P. as Cafta Wins by 2 Votes |
by Edmund L. Andrews
(No verified email address) |
Current rating: 0
29 Jul 2005
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WASHINGTON, July 28 - It was just before midnight on Wednesday when Representative Robin Hayes capitulated.
Mr. Hayes, a Republican whose district in North Carolina has lost thousands of textile jobs in the last four years, had defied President Bush and House Republican leaders by voting against the Central American Free Trade Agreement, or Cafta.
But the House speaker, J. Dennis Hastert, told him they needed his vote anyway. If he switched from "nay" to "aye," Mr. Hayes recounted, Mr. Hastert promised to push for whatever steps he felt were necessary to restrict imports of Chinese clothing, which has been flooding into the United States in recent months.
As it turned out, the switch by Mr. Hayes was decisive. Within a few minutes, the House approved the trade pact by the paper-thin margin of two votes, 217 to 215. The pact would eliminate most trade barriers between the United States and Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua.
The cliffhanger House vote was one of the most wrenching in Congress this year, and it highlighted the messy compromises that were necessary to overcome deep antagonism in many quarters toward trade-opening agreements.
The restrictions Mr. Hastert promised could come soon. Within the next 10 days, the Bush administration is expected to rule on whether to impose import quotas on Chinese sweaters, wool trousers, bras and other goods.
Mr. Hastert "said to me, 'If you vote with me, we'll do everything we need to do in your district to help with jobs,' " Mr. Hayes recalled.
Democrats charged Republicans with buying votes and forcing members to vote against their consciences.
But Bush administration officials said the ultimate goal was one of high principle: an opening of the United States to greater competition and engagement with poorer countries in its own backyard, a liberation from trade barriers that would benefit Americans as well as their neighbors.
"This became much bigger than Cafta, because it became a political issue," said Rob Portman, the United States trade representative. "It was important to our position as the global leader on trade, so we had to fight back, and to fight back meant being very aggressive, explaining why it was good."
Trade agreements have almost always been difficult to pass, because any reduction in barriers provokes intense opposition from unions and industries that would face new competition.
But the Central American trade pact became a litmus test for both parties, a precedent for both the opportunities and dangers of freer international trade.
In economic terms, the Central American trade pact will have a negligible impact on the United States. About 80 percent of the exports from those countries to the United States were already duty-free, and the total trade volumes are tiny: American exports to the six countries - about $17 billion a year - are about equal to the annual global exports of New Jersey.
Supporters of the trade pact said it was the principles at stake, a reaffirmation and an expansion of the much bigger North American Free Trade Agreement of 1994 that linked the United States, Mexico and Canada.
Like Nafta, the Central American free trade pact will eliminate most barriers to trade in goods and services and most barriers to investment. It will give American companies tough new legal rights to enforce patents and copyrights in other member countries, and it may give some pharmaceutical companies even greater protection against generic drugs in Central America than they have in the United States.
But labor unions and their Democratic allies charge that the pact offers strong backing to corporations while offering little additional protection to low-wage workers in Central America. As a result, they contend, it will encourage American companies to shift more jobs to those countries.
Whatever the economic merits, the vote on Wednesday night made it clear that the political appeal of the trade agreement was low. Only 15 Democrats supported the measure.
And despite intense pressure from President Bush and House Republican leaders, 27 Republicans voted against the deal; many others badly wanted to do so.
The biggest opposition among Republicans came from textile producing states in the south, sugar-producing states like Louisiana and Idaho and old-line manufacturing states like Ohio and Pennsylvania.
House Republican leaders kept the voting open for almost a full hour, in violation of the normal 15-minute time limit. They spent much of that time wrestling with about 10 rebellious but "undecided" Republicans, pleading and pressuring one after another to vote for the agreement.
One of the strangest votes was by Representative Charles H. Taylor, Republican of North Carolina, who had vowed to vote against the pact because of his concerns for textile workers.
But as the minutes ticked by, Mr. Taylor was one of only two members recorded as not voting. By not voting, he gave Republicans a two-vote victory rather than a one-vote margin.
But on Thursday, Mr. Taylor insisted that there had been an error in the electronic voting system and that he had indeed voted against the measure.
"I voted NO," Mr. Taylor announced in a terse statement on Thursday, saying the House clerk's written log showed his vote and that he would seek to have the vote registered as a "no."
Democrats, who have already lined up a potent challenger to Mr. Taylor for the next election, accused him of trying to have it both ways.
"He seemed to find time to vote for procedural motions and legislation that had nothing to do with North Carolina," said Bill Burton, a spokesman for the Democratic Congressional Campaign Committee, "but he couldn't seem to figure out how to squeeze in the time to vote against a trade deal that could cost North Carolina thousands of jobs."
But business groups, including even some parts of the textile industry, lobbied fiercely in favor of the trade pact. The National Association of Manufacturers, the Chamber of Commerce and the American Farm Bureau Federation all supported the agreement and pushed hard.
One Republican who agonized over the vote was Representative Mark Foley of Florida, whose district includes some of the biggest sugar producers in the country.
Mr. Foley, a member of the House leadership team responsible for lining up votes, supported the bill even though he staunchly opposed the pact because it would allow higher sugar imports.
"It was difficult, a gut-wrenching night," Mr. Foley said on Thursday. President Bush called him about 8:20 p.m. Wednesday to plead for his vote, he said, and Republican leaders had already made it clear that they would punish the sugar industry in the next farm bill if they managed to defeat the trade pact.
"If the administration thinks that sugar brought about the demise of this, there would have been hell to pay in the farm bill," Mr. Foley said. "This was somewhat of a vote for the survival of my constituents."
Representative Nancy Pelosi of California, the House Democratic leader, accused Republican leaders of trading anything they had to get the votes they needed.
"Once again, the floor of the House of Representatives resembled the set of 'Let's Make a Deal,' " Ms. Pelosi said Thursday.
"What was the cost to the U.S. taxpayer for the president, with all of his power and all of his influence at his disposal, what was the cost to U.S. taxpayers of his very slim margin?"
The full answer will not be known for some time. Opponents of the trade pact said Republicans lured many lawmakers by earmarking billions of dollars for pet projects in a $286 billion highway spending bill.
The House and Senate conferees said they had reached agreement on the overall transportation bill, but as of Thursday night they had not made any details public.
* Copyright 2005 The New York Times Company
http://www.nytimes.com |
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