Don't be fooled by CAFTA

In the past we have supported the alphabet soup of trade agreements that promised greater access of American goods to other nations -- GATT, WTO and NAFTA. We're beginning to think we've been had, and we're drawing the line at CAFTA.
A decade ago, NAFTA, which established a free trade agreement between the United States, Canada and Mexico was billed as an absolute necessity to U.S. economic growth. It would, proponents said, expand U.S. markets and create U.S. jobs.
It didn't. But nonetheless, proponents of CAFTA are making the same promises.
CAFTA, which is short for the Dominican Republic-Central America Free Trade Agreement, has been signed by the Bush Administration and the governments of Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic. It now goes to Congress for and up-or-down vote.
NAFTA, its supporters in business and government, said would create 170,000 U.S. jobs in the first year of its enactment. Nine years later, the total jobs lost is estimated at 880,000, according to a report prepared by Democrats on the House Committee on Agriculture. And most of those jobs were not in agriculture, but in high-wage industries.
Same old song
Proponents of CAFTA are now predicting that it would be a boon to agricultural exports. Beware. The same was predicted for NAFTA, but in 1996 the United States was exporting $27 billion more in agricultural products than it was importing. In 2005, the U.S. will import as much as it exports for the first time in 46 years.
Not all of that shift is attributable to NAFTA, but much of it is. Consider fruits and vegetables, which have been particularly hard hit. In 2003, the United States imported $957 million worth of tomatoes from Mexico; it exported $78.8 million.
The total trade deficit with Canada and Mexico has grown from $10.6 billion in 1993 to $110.8 billion in 2004.
Because of demographics of the nations involved, CAFTA has even less potential than NAFTA to provide a market for U.S. goods, and an even greater potential to drain jobs from the United States.
Companies involved in agribusiness, automobiles, telecommunications, and high technology have benefited from NAFTA, but not by increasing their exports from the United States. They've improved their bottom lines by exporting jobs from the U.S., primarily to the maquiladoras area of Mexico.
But the United States cannot prosper by exporting jobs to Third World nations, even if it does increase corporate profits.
Congressmen who approved NAFTA expecting great things should consider a piece of folk wisdom -- fool me once, shame on you; fool me twice, shame on me -- when voting on CAFTA.