“After NAFTA Comes CAFTA: Labor may object to the Central American Free Trade Agreement — but not nearly as much as do the sugar and rice industries,” by Robert B. Reich, American Prospect, 8 December 2004, http://www.prospect.org/web/page.ww?section=root&name=ViewWeb&articleId=8918.
Following up both on the “Clinton was a great President” and Chinese textile themes, WJC’s former Labor Secretary comes out in favor of the Central American Free Trade Agreement.
In fact, the real issue surrounding CAFTA isn’t about manufacturing jobs at all. It’s about agriculture commodities like sugar and rice. U.S. sugar producers don’t want CAFTA. They want to keep their generous government subsidies and tariffs that result in sugar prices here being three times what they are on the world market. CAFTA would open the door just a crack to much cheaper sugar imports from Latin America, and America’s sugar barons won’t hear of it.
As to American rice growers — yes, there are American rice growers — they get more than a billion dollars a year in subsidies from Uncle Sam. A billion dollars is more than Nicaragua’s entire national budget. It’s even more than the total market value of all the rice that’s produced in the United States. Unless those subsidies are ended, CAFTA will flood Latin America with U.S. rice so richly subsidized by U.S. taxpayers that Latin America’s own rice-growing farmers will be forced out of business.
So you see, the issue behind CAFTA is really the same one that derailed the Doha round of global trade talks a while back: How to wean big agribusinesses off tariffs and subsidies so poorer nations can sell their food to the rich. To the extent CAFTA is a step in the right direction, it’s a good idea.
George H. W. Bush, William J. Clinton, George W. Bush. Three great Presidents, one great trade policy.