Trade Wins
By STUART E. EIZENSTAT and DAVID MARCHICK
March 8, 2005; Page A20
Democrats in Congress need a united front not
merely to oppose policies that can damage the country, but also to
propose constructive alternatives on issues such as the
privatization of Social Security, soaring budget deficits, and tax
policies that favor the wealthy. As demonstrated by effective
Democratic leaders going back to the days of Lyndon Johnson in the
Senate, Democrats also need to embrace certain Republican policies
that are in the national interest in order to maintain credibility
to oppose those which are not. One early test will be the vote on
Cafta, the Central American Free Trade Agreement --
an agreement that Democrats should support, and on which Congress
plans to hold hearings early next week.
Congressional Democrats cite a litany of reasons to
vote against Cafta -- a free trade agreement that will encompass the
U.S., Costa Rica, El Salvador, Nicaragua, Honduras, Guatemala and,
stretching geography a trifle, the Dominican Republic. Unions, a
core Democratic constituency, bitterly oppose Cafta, arguing that it
will cost American jobs. Besides, they assert, the Bush
administration negotiated the agreement -- why give Bush a victory?
It is argued, further, that unified Democratic
opposition to Cafta will force House Republicans with close races in
2006 to support Cafta, thereby making them court unpopularity on the
stump. Finally, let's face it, Cafta rhymes with Nafta -- and Nafta
brings back memories of President Clinton's brutal fight within his
own party to pass the North American Free Trade Agreement with
Canada and Mexico.
* * *
Democrats should, however, support Cafta for two
fundamental reasons: First, the agreement is deeply in our national
interest and will create, not destroy, jobs. Second, if the
Democratic Party wants to regain the White House and control of
Congress, it has to take pro-growth, pro-jobs positions on key
issues, including trade agreements.
Cafta follows the same template as the United
States' free trade agreements with Australia, Singapore, Jordan,
Chile, Morocco, Canada and Israel -- agreements which garnered
substantial Democratic support. Cafta would also open markets to
U.S. goods and services, lower tariffs, create transparent
government procurement processes and adopt trade facilitation
measures. In fact, exporters from Central America can already sell
products in the United States at zero or low tariffs. Cafta lowers
tariffs on U.S. products exported to Central America.
The implications of Cafta extend into regional
geopolitics. The agreement would solidify the United States as the
leading supplier of goods and services to Central America and the
Dominican Republic at a time when China is making serious inroads as
an investor and exporter in the Western Hemisphere. Late last year,
for example, China's president announced with great fanfare plans to
invest $20 billion in Latin America. The United States needs to
maintain its leadership position in Central and Latin America -- and
this agreement would help American exporters retain a competitive
edge.
Critics of Cafta are correct that the agreement's
provisions on labor and the environment do not have as strong an
enforcement mechanism as similar provisions in the U.S.-Jordan Free
Trade Agreement and might have been improved if negotiated by a
Democratic administration. These provisions, however, can help raise
environmental and labor standards, which, too, will rise with the
increased standard of living that Cafta will provide. Democrats can
also use the legislative process to negotiate with the Bush
administration for improvements in labor and environmental
enforcement in Central America. But to maximize their negotiating
leverage, Democrats will have to maximize the number of votes they
can deliver in favor of Cafta.
The free trade agreement would also strengthen and
solidify democracy and civil society in Central America and the
Dominican Republic, an objective Democrats have supported for
decades. Wars raged in the same region less than two decades ago and
Democratic leaders, including former House Speaker Jim Wright and
Sen. Chris Dodd, have long worked to foster a democratic culture in
the region. Now, the elected leaders in Central America and the
Dominican Republic are looking to cement ties with the United
States. The United States should embrace them, helping to strengthen
relations in a region that feels ignored by the Bush administration.
Democratic support for Cafta is also important to a
core Democratic constituency -- the many U.S. citizens whose fathers
and mothers immigrated to the United States from Central America.
Today, millions of hard-working Americans trace
their origins to Cafta countries. Indeed, remittance payments from
Hispanic Americans remain a large part of the Central American
economies. In 2001, they were 24% of the Nicaraguan Gross Domestic
Product and 14% of the Salvadoran GDP. These payments reflect the
strong ties between Americans who emigrated from Central America and
their families in the region. Democrats should not forget that
President Bush did everything possible to gain ground among Hispanic
Americans in the 2004 election -- Democratic votes against Cafta
would give Republicans yet another issue by which to continue making
political inroads into this important group of voters.
Perhaps most importantly, a vote for Cafta would
help Democrats regain their position as the party of growth and the
party promoting international trade. In doing so, Democrats will be
better positioned to win back the presidency and regain majorities
in Congress. In fact, the most prolific periods of international
trade liberalization have come under Democrats: FDR launched the
formal international trading system; JFK initiated the Kennedy Round
of multilateral trade negotiations; Jimmy Carter concluded the Tokyo
Round; and Bill Clinton closed and secured passage for the Uruguay
Round Agreement and Nafta. Democratic opposition to Cafta swims
against the current of free trade that runs through much of the
party's history.
The Cafta vote will be an early litmus test of
whether Democrats can chart a pro-growth path toward electoral
success. We hope they will take this path, and not elect to walk
through a swamp instead.
Messrs. Eizenstat and Marchick, attorneys in
Washington, held senior international positions in the Clinton
administration and have long been active in the Democratic Party.