News from the Tennessee Valley Opinion
SUNDAY, JULY 31, 2005


Why would Congress approve more free trade?

Ben Franklin said that the definition of insanity is doing the same thing over and over and expecting different results.

Congress must be mad.

How else would one explain Thursday's 217-215 vote in the House to approve the Central American Free Trade Agreement? The Senate approved the pact last month on a 54-45 vote.

The agreement eventually eliminates tariffs and other trade barriers between the United States and Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic. It is smaller in scope but similar in purpose to the 10-year-old North American Free Trade Agreement among the United States, Canada and Mexico.

And how has NAFTA affected the U.S. economy?

The U.S. trade deficit with Canada and Mexico grew 378 percent, from $16.6 billion to $62.8 billion, in the first six years of NAFTA. Imports of cheap foreign goods have far outpaced exports.

According to the Economic Policy Institute, NAFTA created 2.8 million U.S. jobs by 2001, its sixth year. Unfortunately, though, the pact eliminated 5.8 million U.S. jobs, including 1.5 million in the manufacturing sector, the group reported.

NAFTA especially hurt the textile and lumber industries, small farmers and workers in the electronics industry. It also adversely affected workers in related, supply-chain jobs.

Because of the availability of cheap labor and less stringent environmental and labor standards, primarily in Mexico, NAFTA allowed U.S. companies to close domestic factories and move operations south of the border. Companies that retained operations in the states were able to threaten relocation to suppress wages and gain concessions on working conditions.

Who gained by NAFTA's adoption? Big business and large corporate farmers who took advantage of the cheap labor and lax environmental standards in Mexico.

The combined Gross Domestic Product of the six Central American countries party to CAFTA is about one-half of 1 percent of the U.S. GDP. Government corruption, massive debt and widespread poverty plague the Central America region.

CAFTA can only help eliminate the debt and poverty in the participating countries, but to the detriment of U.S. workers. It will also help large U.S. corporations improve profits, but again at the expense of workers and small businesses and farms.

Bill Burton, spokesman for the Democratic Congressional Campaign Committee, called CAFTA "a top priority of big corporate interests looking to lower their labor costs and increase their profits."

So why did House members approve CAFTA? Why did Alabama Republican Reps. Robert Aderholt, Spencer Bachus and Mike Rogers, who had expressed concerns about the pact just days earlier, decide at the last minute to back the deal?

The congressmen say they supported CAFTA only after promises from the Bush administration to safeguard industries in their districts.

Mr. Aderholt said his 11th-hour change of heart was the result of administration promises and talks with the president.

But political contributions from and lobbying by big business interests may have done as much to change their minds.

"Rogers decided to stand with his top campaign contributors instead of standing up for Alabama workers and communities who will be devastated by unfair trade," Mr. Burton said.

The gap between the haves and have nots is about to grow wider.

Leave feedback
on this or

Email This Page