Senate Takes Up CAFTA Trade Agreement
Associated Press | June 30, 2005
By JIM ABRAMS
WASHINGTON (AP) - The most controversial trade deal of the past decade, the Central America Free Trade Agreement, headed for a Senate vote Thursday with supporters encouraged by the addition of several new converts to their ranks.
A successful Senate vote for CAFTA would shift the battle to the House, where Democrats opposing the labor rights provisions in the agreement and Republicans concerned about its effects on local industries have vowed to bring it down.
The House is expected to consider the agreement, signed a year ago but needing congressional approval to take effect, sometime in July.
The Bush administration has lobbied hard for its passage, stressing its importance in promoting economic development and political stability in Central America and determined to avoid what would be a stunning defeat for its policy of promoting a more open global trading environment.
The White House, in a statement, said the agreement ``provides a unique opportunity to promote democracy, security and prosperity in a part of the world once characterized by oppression and military dictatorship.''
Senate Majority Leader Bill Frist, R-Tenn., opened debate Thursday saying it would also ``open the door to 44 million new consumers of American goods.''
Backers say the agreement, which would break down trade barriers on U.S. farm and manufactured goods, could significantly increase exports to Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic, now totaling about $15 billion a year. It would also tear down obstacles to U.S. investors and strengthen intellectual property rights.
But CAFTA has met stiff opposition from labor and environmental groups that contend it doesn't require the Central American countries to improve their records in those areas. Some lawmakers link free trade deals to America's soaring trade deficit and loss of manufacturing jobs. Some Hispanic groups are concerned that poor Central American farmers will not be able to compete with cheap food imports from the United States.
Leading groups in the U.S. sugar industry say increased imports from Central America, while minimal, will open the door for imports from other countries that could destroy the industry.
CAFTA, said Sen. Max Baucus, D-Mont., generally a free-trade supporter who has come out against the agreement, is ``the most controversial trade agreement to come before the Congress since the North American Free Trade Agreement a decade ago.''
Supporters picked up three votes Wednesday after the administration offered proposals to ease concerns over labor rights and sugar.
Sen. Jeff Bingaman, D-N.M., announced he would vote for CAFTA after U.S. Trade Representative Rob Portman said the administration was committed to spending $160 million over four years to promote labor and environmental laws, as well as $150 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.
Two senators who had previously criticized the agreement, Agriculture Committee Chairman Saxby Chambliss, R-Ga., and Sen. Norm Coleman, R-Minn., said Wednesday the administration concessions to protect the sugar industry were enough to win their votes. Those included a pilot program to determine whether a sugar-based ethanol initiative is feasible.
The American Sugar Alliance, an industry association, said the administration proposals were inadequate.
``We came up with some good ideas, but in the end the timeline was too short,'' said Republican Sen. Craig Thomas of the sugar beet-growing state of Wyoming. Thomas voted against the pact when it cleared the Senate Finance Committee earlier Wednesday.
The Bush administration has so far succeeded in enacting free trade agreements with Singapore, Chile, Australia and Morocco. It is working on a new World Trade Organization round of market-opening measures as well as bilateral agreements with South Africa, Bahrain and others.
The bill is S. 1307.