CAFTA Approved by Key US Congressional Committee

July 1st, 2005 at 11:39 Björn Hallberg

Now they’ve done it.

The top Bush administration trade priority in the U.S. Congress, the free trade agreement with Central American countries and the Dominican Republic, known as CAFTA, has moved ahead with approval by a key House of Representatives committee. The Senate is now considering the agreement which brought more debate about the impact free trade agreements have on the U.S. economy, and workers in other countries:

Approval by the House Ways and Means Committee improves the chances for CAFTA when the full House considers it after the Independence Day congressional holiday.

So what is CAFTA about? Well according to the brief corporate media version …

CAFTA seeks to bring down tariffs between the United States and five Central American countries — Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua, and includes a separate pact with the Dominican Republic.

But is that the whole truth and nothing but the truth? No. By reading transcripts from congress it is apparent that even the supposedly savvy politicians in the committee have either just been skimming the surface or are trying to cover up the real impact of CAFTA and its template, NAFTA.

Some have a far more sinister take on so called “free” trade [Public Citizen: CAFTA: Part of the FTAA Puzzle] [Stop CAFTA: About CAFTA].

CAFTA is NAFTA Extended to Central America

All the same issues human and labor rights organizations have with NAFTA (and FTAA) are present in CAFTA, including:

Secrecy Instead of Transparency: No formal public input or oversight in the negotiations.

Corporate Domination Over Democracy: At the expense of democracy and people’s right to self-rule, CAFTA would likely give corporations powers to object to barriers to free trade, including laws people enact for their own protection. For example, NAFTA established the right for companies to sue governments over public-interest laws that may limit their profits. This right has been employed 27 times by companies since 1994.

Increased Inequality: A minority of rich companies and wealthy stockholders will benefit from reduced costs. The poor will get poorer and more people will move into poverty: workers will get lower pay and lose their jobs while shouldering higher costs of living as more services are privatized.

Disappearing Public Services: Resources such as education, health care, energy, and water utilities owned by everyone in a community will more likely become owned by corporations. This could put essential public services out of the hands of many people. For example, When Bolivia privatized its water utility, water rates increased 200 percent, leading to riots that resulted in six deaths.

Reduced Labor Rights: Labor laws such as those that protest worker’s safety can also be challenged and the “race to the bottom” for pay will likely hurt workers in all countries involved in CAFTA.

Negative Agricultural Impact: Increased corporate domination of farms and possible devastation of family farms and farmers in the US and Central America.

Environmental Destruction: Environmental laws are just one types of barriers to trade that can be gutted. This decreases costs to companies but increases costs to local communities which suffer more health problems as a result of pollution.

As CAFTA must be approved by the National Assemblies in each of the participating countries, one must wonder what is going on in central America. Is CAFTA just getting rubber stamped?
CAFTA includes the United States, El Salvador, Nicaragua, Guatemala, Honduras, Costa Rica and possibly the Dominican Republic.

Entry 7 filed under: Americas, Central America, North America. This entry was posted 3 years, 5 months ago. RSS feed for comments on this post.