July 29, 2005
Free Trade - Bush Style
The House passed the Central America Free Trade Agreement (CAFTA) 217 to 215. The vote happened after midnight, and only after President Bush, administration officials and Republican “leaders” “twisted arms” and made “deals” did the vote reach this point. The tactics used were revolting and the result of this “success” by the Bush administration should not be called “free trade” but “Big Business trade.”
Before the vote, the president arrived to convince Republicans of the beauties of CAFTA. He and Republican leaders cracked a few arms and made deals. At about 11:17 PM, during the usual 15-minute voting period, the NO votes were ahead 180 - 175. House Republican leaders extended the voting period by 47 minutes for further arm cracking and deal pushing. Here are a few examples of these "democratic" tactics:
- ADERHOLT DEAL - Representative Robert P. Aderholt of Alabama agreed to vote for CAFTA after he got a letter signed by Commerce Secretary Carlos M. Gutierez and U.S. Trade Representative Rob Portman promising to protect sock manufacturers and poultry producers in his district. This is free trade?
- BOB INGLIS DEAL - Representative Bob Inglis of South Carolina voted for CAFTA after he received 3 free-trade-killing commitments:
- Central American countries could export trousers duty-free to the United States only if they are made with pockets and linings from American mills
- An increase in the amount of American fabric that Nicaragua agrees to buy in making clothing for exports
- Making it tougher for Central American clothing factories to rely on fabric from Mexico
- Central American countries could export trousers duty-free to the United States only if they are made with pockets and linings from American mills
- TAYLOR NO VOTE - Representative Charles H. Taylor of North Carolina voted NO, but, he explains, the vote was not recorded. What a shame!
- DAVIS LATE - Representative Ann Davis of Virginia went to a Boy Scout event and then arrived too late to vote. Could it be she did not realize that with her and Taylor's NO votes CAFTA would be doomed?
A huge-clout industry is "Big Pharma." Big pharmaceutical companies inserted language in the accord, to prevent cheaper, generic drug manufacturers from selling their products, including life-preserving anti-retroviral treatments for AIDS victims, to needy patients in the region. Because of this "free trade" agreement, many sick people in Central America will die.
It makes me sick when I hear members of this administration declare that CAFTA will help the poor and helpless in Central America. "Big Pharma" will make money. Central American poor will get poorer and sicker.
CAFTA is anti-labor and Republicans have made it so. Senator Kerry offered an amendment to CAFTA back in the Senate Finance Committee. Its purpose was to force CAFTA to include stronger provisions to protect American and Central American workers. Kerry thought that since the bill contains measures to allow corporations to challenge violations of patents and intellectual property, it should also contain similar measures for workers to challenge violations of labor laws. Republicans voted solidly against this.
CAFTA is a monstrosity, a Republican monstrosity. It serves only the interests of Big Business at the expense of labor, both American and Central American, and takes advantage of the poor and sick in Central America.
This is free trade - Bush style.
Posted by Paul Siegel at July 29, 2005 05:57 PMCAFTA – DR will benefit both the U.S. and the countries of Central America and the DR. I am glad the President had the courage to twist arms to do the right thing. Protectionism helps established interests, but hurt the rest of us. Democrats once understood that too.
Posted by: jack at July 29, 2005 06:34 PMOf course - most the people near where I live (NC) are furious about CAFTA. They got their fill of GAFTA when their manufacturing jobs vanished overnight and overseas.
It’s a great deal for multi-nation corporations - and if there were basic standards in place for treatment of workers, environmental protections, etc. - I’d be for the idea (in theory at least). However, if you are a low-education blue collar worker, then it’s not so hot. You are now in direct competition with workers in South America who’s cost of living and wage rates are not even in the same ballpark (in Ecuador - the average worker makes $86 per month.) As well, if you want Health Care - or 40 hour work weeks…
Posted by: tony at July 29, 2005 07:09 PMTony,
We’ve been in direct competition for years, but some people are in denial. This agreement at least puts everyone on the same page. (Although I’m sure some will argue this point)
Remember, those manufacturing jobs would have eventually left anyway.
It is a global economy.
You cannot change it.
You cannot protect us from it.
You have to live with it.
You have to learn to profit from it.
To borrow a phrase from Lee Iacocca…
Lead, Follow, or Get Out of the Way…
We are Leading the Way…
(But there will be those who will kick and scream through the process, there always is)
Yes - I agree with you. Manufacturing is our past - not future. However - do you know where Bush chose to announce his push for CAFTA?
Hickory, North Carolina.
I know the area very well… it’s a ghost town, a hold over from it’s manufacturing days. He presented the idea there to prove that he is excited about the jobs it’ll bring.
It seemed almost cruel in it’s dishonest omission: those jobs are not for you people here… but thanks for thr support.
Posted by: tony at July 29, 2005 08:20 PMRepresentative Ann Davis of Virginia went to a Boy Scout event and then arrived too late to vote.
The voting was open until after midnight. That must have been a hell of a jamboree.
I love how you red columnists are singing the praises of CAFTA as a free trade deal. One of the points of Pauls article is that President Bush had to promise ad-hoc protectionism to get the votes.
IIRC, the US sugar industry also got protections as part of the deal.
Someone in the administration said CAFTA gives us 40 million new customers. He neglected to mention that it also gives American workers 40 million new competitors for their jobs.
It is a global economy…. Lead, Follow, or Get Out of the Way… We are Leading the Way…
Where are we going?
From what I understand, there were a number (10 if I recall correctly) of Democrats who chose to support CAFTA as well as the Republicans. Does anyone have any information on why that was?
Also, I’d like a bit more information on Taylor’s vote… how can a representative’s vote simply not be recorded as if it had never happened? Especially on an issue where the vote is so close to begin with?
I’d hope for more discussion of the extension of voting, as well, but at this point I’m sure most people simply see it as business as usual…
Posted by: Jarin at July 30, 2005 02:23 AMEvery free trade agreement in the last 14 years has been followed by ever higher trade deficits and weakening of wage buying power and benefits for middle class workers. What more can be said. Bush et.al, are indeed positioning the corporations which they are invested in for the global marketplace regardless of any or all harm that may result to American workers. By implication, this stand says they view workers as means to an end, and that has always been a GOP position in action if not words. Of course, labor has been means to and end for Democrats as well, but, at least Democrats championed workers causes for decades as means to their ends of retaining majority status in government.
Democrats failed to recognize the sea change which caused organized labor to act against workers interests in the face of globalization. In failing to recognize that sea change, The Dem. Party continued to champion organized labor when in hindsight, they should have been pressuring labor to see what globalization would mean, and help organized labor to adjust and adapt to the needs of workers in the face of changing demands and the desperate need of workers for assistance in educational improvements and job retraining for industries which the US could still retain dominance in.
If the Democratic Party wants to regain credibility with the American worker, it is going to have get far more educated and versed in predicting where America CAN remain competitive and push for legislation and programs that will prepare workers for the opportunities left available to the US by India’s and China’s and Malaysia’s inevitable domination of production and manufacturing and technical services.
The Democratic Party should require all of its leadership to read Friedman’s The World is Flat or find new leadership which has and understands what is taking place. For without that insight, the Democratic Party will be entirely ill-equipped to meet the needs of American workers as the eddies of global market labor changes force consequences upon American labor. If American labor is prepared, those changes can be for the benefit of American workers, and if not prepared, American workers will continue their descent down the middle class ladder.
Any party that chooses to champion American workers will come right out with intense improvements in education in the schools, OJT investments on the jobs, and retraining investments in a very big way, for that is the only appropriate response to the globalization transition that is taking place. Any party that fails to make those endeavors, has little regard for American workers as people.
By implication, this stand says they view workers as means to an end, and that has always been a GOP position in action if not words.
Implication nothing. Bush’s chief economist flat out stated that outsourcing jobs was a good thing.
As for the Democrats, David, you make some good points. But to be fair, Clinton and Dems in the Senate were (and still are) pretty gung ho on education and retraining initiatives.
Clinton was clearly aware of the benefits, as well as the down-side (including violent extremism), of globalization. Democrats still push for “fair trade”. But being essentially powerless, there’s not a lot we can do. Even when promanent Dems have press conferences about it, they get ignored by the media, because we don’t have the numbers to make it stick.
The Dem’s centerpiece legislation on this issue is Senate bill S.14, the Fair Wage, Competition, and Investment Act of 2005 (full text). Ask your Senators to support it.
tony,
I too live very close to NC in Virginia and have spent most of my life in the apparel, textile and home furnishings industries. There was a time when you could not travel 50 feet in any direction in NC and not find an apparel facility.
You mention Hickory, NC. Once a booming, growing area. Always a debate as to which was the furniture capital, Hickory or High Point.
This CAFTA thing if we address it as industry specific when measuring the loss of jobs would result in a completely different finding than to look at the result as a whole.
tony, you and I both know that there are, for all intents and purpose no more jobs in apparel, textile, hosiery, furniture, etc, left to lose in NC. The fabric and trim mills and knitters will hang on the longest but automation there is having its own impact.
What many people don’t realize that when you lose apparel manufacturing and assembly jobs it involves more than just seamstresses. You lose thread manufacturing, buttons, zippers, labels, tags, hangers, fabric spreading and cutting, belts and accessories, I could go on forever.
The sewing machine companies will prosper because they will just ship them to a different location. A caution here is that a large majority of the “best” sewing equipment is developed in Asia/Japan, etc.
So, IMO apparel manufacturing is an industry that will be least impacted by things like CAFTA because it has already been reduced to a shell of it’s former self.
I would be curious as to what jobs are in jeapordy by Central American labor. Obviously labor cost is cheaper but what types of jobs can they do better or faster than can be done here?
Posted by: steve smith at July 30, 2005 11:24 AMsteve -
Do you see my point with Bush choosing that area to make his statement? Bush knows that manufacturing is going to go overseas… but to promise CAFTA as a way to restore manufacturing jobs here is false hope to some very desperate people.
I know a good bit about Ecuador - I have an employee there. Yea - I know outsourcing… actually, he grew up there and moved back about 3 or so years ago. He was far too good of an employee to loose, so we tried things over the internet. He’s still full time - and he’s planning on moving (with his new wife) back to the states this fall. The labor there is insanely cheap - and the government will do whatever you want with the right amount of financial incentives (to individual bank accounts.) Just take a look at the major pipeline going in there…
I agree that basic cost per employee per hour is a shortsighted and fools-gold way of treating manufacturing. Lots of bad examples - Dell customer service being moved to India was bad as well.
Free trade speaks to the free market here, so it’s a hard thing to argue against. I know many conservatives who hate the opposite - cheap labor coming into the country to take away American jobs. I’ve seen both doing manual labor… and there are things that Americans just don’t seem to built to do.
In theory - I love the idea of let everyone in on a level playing field and let the market drive where the various jobs go. Manufacturing and Tobacco needs to go away - we’ve seen it coming for 30 years. However, I’ve seen the effects of generations of labor forces completely dropped from payrolls. That degree of lost jobs wipes out entire communities… with little way or hope of recovery. The small mountain town I grew up in does not exist, except for tourism and the rich retirees. Unfortunately - that’s raised the cost of living and housing there… so there are so extremely desperate people there.
Do I have an answer - no. No clue as to how to transition into the new global economy without massive damage on several fronts. I do think we should have completely transparency and honesty with what we can all expect from this… yea, more fools-gold.
Posted by: tony at July 30, 2005 11:47 AMtony,
I see your point clearly and your post is outstanding.
In my career I have helped move a few companies (or in some cases, parts of companies) to Central America and places like Haiti and the Dominican. Prior to that Puerto Rico was popular but that ran it’s course.
As a conservative I feel that “big business” or medium sized companies should have the right to seek economic ways to manufacture it’s product. I do not support “deals” between government and business however. Incentives OK, “deals” no.
It sickens me to have witnessed the loss of jobs in this country and, to be honest, I was one of those “buy American” advocates. Sadly, it wasn’t long before you couldn’t find an American made product that you could afford. Also, contrary to popular belief, many products made out of country are not “pieces of junk”, in many cases the quality and material is better than US made.
Govermnent subsidies to unemplyed workers was a good thing. Unfortunately I think it helped create a false economy and, it made some workers so dependent on the subsidy (to which they were entitled) that they stopped seeking work.
To a large extent I assign partial blame to unions. I believe that unions put “a fair days work for a fair days pay” way out of balance. Also management has a share of the blame. I cannot imagine anything easier than getting along well with the people that are working for you and making your life better. That includes compensating them fairly.
Why I have to talk to somebody in India to get computer help is beyond me. Half the time I can’t even understand the guy. Same goes for telephone solicitations.
Posted by: steve smith at July 30, 2005 12:25 PMThanks.
This is truly a difficult issue. My mindset is to continue to do what Americans do best - invent products and create new markets.
I think the next generation of energy is the next big market. We should be running an Apollo-type project to be the first bringing clean, renewable energy to the market. Unfortunately, I think our dependence on our oil-lifestyle and the status quo of riches in oil are preventing us from having that sort of focus.
Who will be the next owner of energy? If American companies own it, then we can secure our viability in the world for several generations. If India or China are first to market - we will quickly become a 2nd class economic power.
I think there is also a HUGE benefit to our war on terror by removing the funding (oil) sources from their efforts. That area of the world will always have issues - 3 main continents and every major religion sharing backyards to each other… But if they have no more oil money, then their world impact will quickly run out of steam…
So - in short, I think we should surrender the manufacturing jobs but not those workers. If we can create new energy and own that market, then I think we will be best able to retrain those who loose their jobs, and in the end we will all be better off.
tony, are you familiar with the Apollo Alliance? They’re a coalition of labor, business, state governors, and religious leaders working together for energy independence. Their tagline is: Three million jobs; Freedom from foreign oil.
