As the NEW YORK TIMES recently noted, the early days of a President's term are prime time for passing trade legislation. In 1993, Bill Clinton got behind the North American Free Trade Act. In 2003 President Bush won passage of Trade Promotion Authority or "Fast Track" which limits Congress to an up or down vote and cannot amend a trade agreement, setting the stage for a new trade legislation push in 2005. This year the battlelines are being drawn over CAFTA — The Central American Free Trade Act which was signed by President Bush on May 28, 2004 in Washington D.C. and is now waiting to be submitted to Congress. Like NAFTA, CAFTA would open up trade between the United States and El Salvador, Guatemala, Honduras, Nicaragua and Costa Rica. According to the Department of Commerce, "More than 80 percent of U.S. exports of consumer and industrial goods will become duty-free in Central America (Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua and the Dominican Republic) immediately, with remaining tariffs phased out over 10 years." CAFTA is often seen as a final step to the larger Free Trade Area of the Americas (FTAA) which would encompass 34 economies. CAFTA must be approved by the U.S. Congress and by National Assemblies in the Central American countries before it becomes law.

While this debate is related to those over globalization, job outsourcing and NAFTA, the CAFTA conflict has some new issues, and new foes. Some worry about the vast difference between the U.S. and Central American economies (combined GDP of Central America is equal to 0.5 percent of U.S. GDP), labor and environmental concerns and the effects on small farmers on both sides of the agreement.

CAFTA's backers were taken by surprise when in late February 2005, the usually pro-free trade National Association of State Departments of Agriculture voted to take a stand against CAFTA. And although Honduras and El Salvador recently passed CAFTA through their legislature, on March 9 and 10, 2005, anti-CAFTA protestors succeeded in preventing Guatemalan lawmakers from making a vote on the pact. Despite the protests, the measure is expected to pass both the Guatemalan and eventually, the U.S. legislatures.

Read more about the debate below and discuss your thoughts on the topic.

Pro-CAFTA	Anti-CAFTA
"The usual suspects are already lining up — business leaders for, labor unions against — and many Democrats are protesting that the pact does not go far enough to protect labor and environment in Central America. It would be easier to believe Congressional opponents really did care about protecting labor and environmental standards in other countries if many of them had not also voted in favor of an American-Jordan free trade accord, which included nearly identical language on labor and environment...The Central American accord is a good idea that will help job growth in a needy region." - "NAFTA, Redux," Editorial, THE NEW YORK TIMES, November 24, 2004	"The Central America Free Trade Agreement (CAFTA) will mean more job loss and wage decline for American workers. In signing CAFTA, the Bush Administration has ignored the mistakes of the North American Free Trade Agreement (NAFTA) and granted a gift to corporate interests who prioritize access to cheap labor, not protecting working families in the United States and Central America. At a time of record unemployment we should be protecting U.S. jobs, not exporting them. I am not opposed to trade; I support fair trade. We need to level the playing field and enact trade agreements that include meaningful labor and environmental standards that will prevent the exporting of U.S. jobs and the exploitation of workers abroad." - Congresswoman Hilda L. Solis, D-CA.
"1. Small Countries, BIG Markets: Central America and the Dominican Republic make up the 2nd largest U.S. export market in Latin America... 2. CAFTA Levels the Playing Field for U.S. Workers and Farmers: Today, nearly 80% of Central American products already enter the U.S. duty-free...CAFTA opens the region's markets to goods, services and farm products from the United States; 3. Strengthening Freedom and Democracy: Elected leaders in the region are embracing freedom and economic reform... 4. Textiles: United to Compete with Asia: With the expiration of global quotas on textiles/apparel at the end of 2004, regional producers face a new competitive challenge from Asian imports. CAFTA would provide regional garment-makers — and their U.S. suppliers of fabric and yarn — a critical advantage in competing with Asia. 5. Strong Protections for Labor and Environment: CAFTA is specifically designed to respond improving (labor law) enforcement....CAFTA contains also ground-breaking environmental provisions. 6. Sugar: "A Spoonful a Week": Increased sugar imports under the agreement equal little more than one day's U.S. production. - "The Case for CAFTA" Office of the United States Trade Representative	"Rushed and Closed Negotiations: CAFTA was completed in one calendar year, with limited civil society or Congressional participation. An Asymmetric Agreement: Analysts expect that — as occurred in Mexico — CAFTA will attract foreign direct investment and boost Central America's exports in certain sectors, but will provide little benefit to the rural and urban poor of the region. Labor: CAFTA is a step backward for organized labor in Central America, unlike earlier trade agreements it does not require compliance with international labor standards. CAFTA only requires that participating countries enforce their domestic labor laws. Agriculture: Central American farmers are concerned that they will be unable to compete in the face of an influx of highly subsidized U.S. exports under CAFTA. U.S. Jobs: Free trade politics have become a topic of renewed debate in the U.S., as the country experience job growth and the outsourcing of manufacturing jobs. Textile manufacturers and the sugar industry are actively lobbying Congress against CAFTA. - "Fair Trade or Free Trade? Understanding CAFTA Washington Office on Latin America
"Over the past ten years, Central America has undergone a spectacular transition from a place where dictatorships were the norm to a democratically-based region where freedom predominates. Continued and sustainable political reform in the region not only benefits the Central American people, but it is vital to US national security as well. DR-CAFTA will help foster the continuation of the political enlightenment that has taken hold by modernizing the Central American economies." - "Americans for Growth Through Trade," The Business Roundtable	"CAFTA is a piece in the FTAA jigsaw puzzle and is based on the same failed neoliberal NAFTA model, which has caused massive job loss, environmental degradation especially along the U.S. - Mexico border, displaced millions of Mexican campesinos and tens of thousands of U.S. family farmers as well as leading to corporate attacks on U.S. state and local laws. Its passage would serve to push ahead the corporate globalization model that has caused the "race to the bottom" in labor and environmental standards and would promote privatization and deregulation of key public services." - PublicCitizen.org

More on Trade Issues

• Facts and Figures on Outsourcing
• Outsourcing Debating
• Employment Resource Map
• Changing Face of Unemployment
• Debating Globalization

Americans for Growth Through Trade
This site of an offshoot of The Business Roundtable lays out its arguments that free trade is: Good for Business; Good for Homeland Security; Good for Job Growth; Good for Consumers. The site has a special information section on CAFTA.

National Farmers Union Opposes CAFTA
Statement of opposition by the National Farmers Union which is a general farm organization with a membership of nearly 250,000 farm and ranch families throughout the United States. National Farmers Union is a federation, that represents farmers and ranchers in all states.

CAFTA’s Weak Labor Rights
Briefing statement from Human Rights Watch which lays out the groups reason for opposing the labor provisions of CAFTA.

Washington Office on Latin America: Free Trade Agreements
This human rights and advocacy group monitors the impact of U.S. foreign policy on human rights, democracy and equitable development in Latin America. It's trade section provides issue brief arguing against the agreement and collects related news from Central American countries.

What Does DR-CAFTA mean for your state?
Compendium of pro-CAFTA information from the Business Coalition for U.S.-Central America Trade. The Coalition’s members represent all the principal sectors of the U.S. economy, including agriculture, manufacturing, merchandising, processing, publishing, services, and shipping.