Senate Committee Endorses CAFTA

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The New York Sun

WASHINGTON – The Senate took up the Central America Free Trade Agreement yesterday, with supporters predicting success in overcoming strong resistance to the market-opening deal with six Latin American nations.


President Bush and his top trade officials have lobbied hard for CAFTA, which received a crucial endorsement earlier yesterday from the Senate Finance Committee. A Senate vote could come as early as today.


The greater hurdle will come when the House takes up the measure next month. House Democrats who object to what they say are weak labor rights provisions in the agreement will be joined in opposition by Republicans with ties to groups, most notably the sugar industry, that contend they will be hurt by CAFTA.


The trade accord was signed a year ago with Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic. It requires congressional approval before going into effect.


“Step by step, we’re making good progress and building momentum for its successful passage,” said a U.S. trade representative, Rob Portman, who has led the effort to sway undecided lawmakers.


He picked up a key vote yesterday when Finance Committee member, Senator Bingaman, a Democrat of New Mexico, announced his support after receiving a pledge from Mr. Portman of increased spending to protect Central American workers and farmers.


Mr. Portman, in a letter to Mr. Bingaman, 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 American agriculture imports.


The Bush administration has so far succeeded in enacting free trade agreements with Singapore, Chile, Australia, and Morocco, but the CAFTA deal has been far more difficult, mainly because of near-united Democratic opposition. Democrats say provisions on labor rights are weak and will lead to a continuation of abuses such as child labor and crackdowns on organized labor.


They also say trade deals, such as the 1994 accord with Mexico and Canada, have exacerbated the American trade deficit and the flight of American jobs overseas.


Rep. Sherrod Brown, a Democrat of Ohio, who has led the opposition in the House, predicted that in the Senate “CAFTA will pass with the lowest margin of any trade agreement in the modern era. With the real fight in the House, the deal is anything but done.”


CAFTA would end trade barriers now encountered by American goods in the six countries, which already enjoy open access to the American market. It also would clarify investment rules, strengthen protections for intellectual property, and, according to supporters, solidify economic and democratic stability in a region that has been wracked by civil wars in the recent past.


“There is a geopolitical component to CAFTA,” said Senator Kyl, a Republican of Arizona. Some fragile democracies in Central America, he said, “are teetering on the edge of continuing to support the United States.”


Mr. Portman and Agriculture Secretary Mike Johanns have also been meeting this week with lawmakers from sugar-growing states and representatives of the sugar industry in an attempt to mollify their fears that increased imports from CAFTA countries, while small, would open the way for a foreign onslaught on the industry.


Senator Thomas, a Republican of Wyoming, whose state is a big sugar beet grower, said yesterday he voted against the agreement in the Finance Committee because attempts to broker a deal with the industry had not succeeded. He chided the administration for not moving sooner to find a solution.


The top Democrat on the committee, Senator Baucus 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 not consulting more with Congress and for rejecting a proposal to help American service industry workers who lose their jobs because of foreign competition.


The New York Sun

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