The Senate took up the Central America Free Trade Agreement yesterday, with supporters predicting success in overcoming strong resistance to the market-opening deal.
Passage in the Senate, traditionally more sympathetic to trade agreements, could give CAFTA some momentum in the House, where there is stiffer opposition. A Senate vote on the measure could come as soon as today.
CAFTA would end trade barriers encountered by U.S. goods in Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic. It also would ease investment rules and strengthen protections for intellectual property. Supporters say CAFTA would solidify economic and democratic stability in the region.
The greater hurdle will come when the House takes up the measure next month. The agreement has run into vigorous opposition from labor groups and their Democratic allies. The U.S. sugar industry is also opposed, claiming that an increase in Central American imports, while small, could open the door to ruin. U.S. sugar producers have long enjoyed extensive protection from foreign competition.
President Bush and his top trade officials have lobbied hard for CAFTA.
"Step by step, we're making good progress and building momentum for its successful passage," said U.S. Trade Representative Rob Portman, who has led the effort to sway undecided lawmakers.
He picked up a key vote Wednesday when Sen. Jeff Bingaman (D-N.M.), a Finance Committee member, announced his support after receiving a pledge from Portman of increased spending to protect Central American workers and farmers.
Portman, in a letter to Bingaman, said the administration was committed to spending $160 million over four years to promote labor and environmental laws, as well as $150 million over five years to help subsistence farmers in three Central American countries who might be displaced by an increase in U.S. agriculture imports.
The Bush administration has so far succeeded in enacting free trade agreements with Singapore, Chile, Australia and Morocco, but the CAFTA deal has been far more difficult, mainly because of near-united Democratic opposition. Democrats say provisions on labor rights are weak and would lead to a continuation of abuses such as child labor and crackdowns on organized labor.
They also say trade deals, such as the 1994 accord with Mexico and Canada, have exacerbated the U.S. trade deficit and the flight of U.S. jobs overseas.
Rep. Sherrod Brown (D-Ohio), who has led the opposition in the House, predicted that in the Senate, "CAFTA will pass with the lowest margin of any trade agreement in the modern era. With the real fight in the House, the deal is anything but done."
Portman and Agriculture Secretary Mike Johanns have also been meeting this week with lawmakers from sugar-growing states and representatives of the sugar industry in an attempt to mollify their fears that increased imports from CAFTA countries, while small, would open the way for a foreign onslaught on the industry.