An Unbalanced Trade Policy
You can set your watch by it.
Whenever a trade pact comes to Congress, its supporters warn the American people that if we don't pass the agreement our economy will be hurt and our trading partners will be devastated.
An annual U.S. trade deficit that has gone from $38 billion to $617 billion in a dozen years makes those claims hard to believe. And since Congress passed President Bush's trade promotion authority three years ago, we have lost one-sixth of our manufacturing jobs.
When the proponents of trade agreements have nothing left to sell, the name-calling and misrepresentations begin. Now that the Central American Free Trade Agreement (CAFTA) has been sent to Congress, its supporters are calling its opponents isolationists, or protectionists, or even anti-democratic. They claim that those who oppose this trade agreement are simply special interests opposed to trade, that they don't care about the poor in the developing world, that they want to pull up the ladder and keep out foreigners. For a change, let's look at the facts.
The combined economic output of the Central American countries is about $62 billion, equivalent to that of Columbus, Ohio, or Memphis, Tenn. Annual per capita income of a Nicaraguan worker is about $2,300, less than one-sixteenth of an American's.
CAFTA will not enable Central American workers to buy cars made in Ohio, or software developed in Seattle, or prime beef from Nebraska. CAFTA is about U.S. companies moving plants to Honduras, outsourcing jobs to El Salvador and exploiting cheap labor in Guatemala. Opposition to CAFTA is deep and broad in the United States: workers who are anxious about their jobs, their pensions, their health care; school districts that lose revenue with every plant shutdown; small businesses that can't compete with corporations using cheap labor to undercut the market.
Opposition is just as deep and broad in Central America. More than 8,000 Guatemalan workers protested against CAFTA in March; the police responded with tear gas. In El Salvador, tens of thousands protested the agreement; the Salvadoran legislature responded by passing it in the middle of the night with no notice and little debate.
In Costa Rica 30,000 protesters took to the streets last fall. And Costa Rican President Abel Pacheco announced this month that his country would not ratify CAFTA unless an independent commission could determine that the agreement will not hurt the working poor.
What really makes sense is a trade policy that lifts workers up in rich and poor countries alike while respecting human rights and democratic principles. Workers' rights should enjoy the same guaranteed protections as CAFTA provides to prescription drug companies. Environmental and food safety laws deserve the same legal standing that CAFTA extends to CDs and Hollywood films.
The United States, with its unrivaled purchasing power and its enormous economic clout, is in a unique position to help empower poor workers in developing countries while promoting prosperity at home. When the world's poorest people can buy American products, not just make them, then we will know that our trade policies are finally working.
The writer is a Democratic representative from Ohio and author of "Myths of Free Trade."