CAFTA Passeda

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A narrow win for the Central American Free Trade Agreement. It's not a perfect agreement—congressional poodles trotting leashed behind the sugar industry only slightly opened the U.S.'s hyperprotected market to the most popular legal white powdered import from south of the border. But the conventional wisdom here—that a defeat here would've been a crushing symbolic blow to trade liberalization's forward momentum—was probably right in this case.

Still, it's been more than a little embarassing to watch the debate over this, on both sides. From Republicans, we've heard neo-mercantilist language about how the real benefit of CAFTA is that we can really stick it to China. But the argument that took the cake was one I heard from a reporter on NPR yesterday afternoon, attributed to unnamed Democrats: Freer trade will exacerbate income inequality within Central American countries, destabilizing the region and therefore threatening U.S. national security.

Now, there's an old joke among debaters—embodied in R.E.M.'s "It's the End of the World as We Know It"—that every high school policy debate round had to include a claim that one's opponent's proposal—even if it were about food stamps or gay marriage—would somehow lead to nuclear war, the "nuclear war disad." I'd always thought a high school argument would be the only place that would fly, but I'll admit, I hadn't considered Congress.

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  1. So what’s Ron Paul’s explanation for not wanting Americans to be able to trade with Central America?

  2. Trade will displace traditional industries…

    Which will lead to a revolt…

    Which will lead to anarchy and violence…

    Which will lead to a “failed state” where Al Qaeda can thrive…

    Which will make it easier for them to smuggle a nuke into the US…

    I therefore urge the judge to flow this round negative. The affirmative team’s plan would lead to nuclear war, so on comparative advantage alone it fails. They also failed on significance, harms, inherency, and solvency. The only thing we aren’t contesting is topicality.

  3. To be fair, the White House first spun CAFTA as a national security issue, which was just as much a crock.

  4. “…that a defeat here would’ve been a crushing symbolic blow to trade liberalization’s forward momentum…”

    The emergence of _this_ line of argument (or insinuation?) is what has surprised me. I should support CAFTA for _symbolic_ reasons, to demonstrate my loyalty to trade liberalization and to defend it from the gathering dark forces? If the agreement isn’t defensible on its merits then trade liberalization is going to have to fend for itself.

    Anon

  5. Ron Paul’s reasons for opposing CAFTA are here:

    http://www.lewrockwell.com/paul/paul254.html

  6. What, Saint Paul voted “nay”?

  7. Ammonium:

    Here’s why.

  8. This is politics; the symbolic effect *is* one of the chief merits. Or, less glibly: Imagine the effect of voting down CAFTA was that legislators from all the relevant countries went back to the drawing board and came up with a better, more genuinely free-trade agreement. Well, then you’d want to vote it down. Imagine instead that the effect (as it likely would’ve been) was to stall further liberalization. It seems a little obtuse to pretend that the immediate effects of the bill can or should be evaluated without reference to that context–though CAFTA itself should indeed have mildly positive effects “in itself,” to the extent that can actually be disentangled.

  9. “CAFTA and other international trade agreements do not represent free trade. Free trade occurs in the absence of government interference in the flow of goods, while CAFTA represents more government in the form of an international body. It is incompatible with our Constitution and national sovereignty, and we don?t need it to benefit from international trade.”

    -Ron Paul

  10. I’m not sure I totally buy Ron’s arguments, though, especially from a realist’s POV. He seems a tad too idealistic here, prattling on about the “absence of government interference in the flow of goods”, as if that’s a plausible/realistic scenario in our lifetimes.

  11. Yeah, I noticed a sizable minority grumbling about how CAFTA wasn’t nearly open enough. I’m sure if it had gotten voted down, the new majority position would have coalesced around an option that was even more favorable to free trade.

    /sarcasm off, in case you didn’t notice. If Ron Paul and the other hard-core free trader (I forget his name) had been the deciding votes to defeat CAFTA, it would have been a textbook example of the perfect being the enemy of the better.

  12. It’s a slippery slope towards total trade freedom. Uphill.

  13. It cracks me up when you guys remind me of ye olde high school debate team. I went through two years of it. More like one and a half really.

    When we went to the state competition, on the approximately remembered topic of Resolved: The US Government should siginificantly increase exploration beyond earth’s atmosphere,” we drew the negative against a team that was floating the idea of sending probes into black holes. In our view, we trashed them on all points. In the judges’ view, they had a trump card in the form of ‘superior sourcing’. They had some goofy quote to the effect of ‘ANY space exploration will produce significant positive effects for mankind,’ and since we could only argue from such vague concepts as cost and General Relativity, they retained solvency, significance and inherency. Never went to debate practice again.

    Ahh the memories.

  14. Good points, Julian. And of course if you vote down bill A in favor of competing bill B (which has the same general goal of A but which you see as superior), but bill A passes and bill B dies, you’ll hear commercials about how you didn’t even support the ideas in A. The flurry of competing bills after 9/11 made this quite common in the last election, and those voters that don’t do their own research drink the kool-aid the commercials feed them.

  15. Julian,

    It’s the “chief merit” part I take issue with. If, as Tyler Cowen suggested, the _chief_ merit of the bill is symbolic, then what use is it? Exactly how much bad legislation are you willing to pass because its heart is in the right place? Cowen’s conclusion reads to me as if he supports the bill because it is _purportedly_, but not _actually_, about free trade. If this is an acceptable standard, it should be easy to free the Free Patriot Trade Act passed next session.

    I think of it as a sorities paradox, if you will. How much free trade can you remove from a free trade bill before it is no longer a free trade bill?

    I feel this is compatiable a realist position, because it recognizes that anti-free trade forces will naturally try to co-opt the symbolism of the pro-free trade forces. Hence the symbolic weight of any bill should be weighed against, you know, its actual legal and economic consequences. Commentary like Cowen’s, coming from people who should be very supportive of free trade agreements, has just made me wonder if some scales aren’t out of whack.

    Anon

  16. Hey guys,
    I just was notified that I am leaving the oven shortly. I’ll be staying in Chicago a day or two. Any Reasonites in Chicago want to go our for a drink or two?

  17. Should we oppose tax cuts until the IRS is abolished?

    Should we oppose limits on eminent domain until joe’s job is abolished?

    Should we oppose loosening medical regulations until my job is abolished?

    If you answered no to any of those questions, why oppose a bill that (mostly) liberalizes trade on the grounds that it still leaves a bureaucracy in place?

  18. The point isn’t that “its heart is in the right place.” The point is that (1) the bill itself is a step in the right direction, however suboptimal, and (2) the bill makes further liberalization more likely, while its defeat makes it less likely, denies us even the small improvements CAFTA represents, and invites something worse (e.g. a “free trade” bill that holds Nicaragua to Sacramento’s wage and environmental standards).

  19. I remember the CX guys from high school…stuttering, caffine-addled fellows with wild eyes. They ate spoonfulls of instant coffee and washed it down with Moutain Dew.

    There’s a reason I did parli, I could never talk fast enough for CX.

  20. Thoreau,

    I admit that on this issue libertarians can sincerely end up on either side, but I tend to side with Dr. Paul, so I’ll try to answer your question:

    “why oppose a bill that (mostly) liberalizes trade on the grounds that it still leaves a bureaucracy in place?”

    Because it doesn’t ‘leave’ a bureaucracy in place, it creates or increases the powers of a centralized bureaucracy. If you’re of the stripe that really cherishes federalism for the fact that having competition between governments is a good thing, you don’t like creating yet another, higher, centralized government above the Feds. Considering we have an explicit document that was supposed to limit the power of the Feds and has failed miserably, it shouldn’t be unreasonable to think that creating a government or government-like agency even higher than the Feds, with an EU Constitution like document might be a bad thing, even if it is symbolically a good thing.

    Like I said, I can understand the contra argument, but I think I gotta side with Dr. Paul – we’re creating a new, ever larger Leviathan, even more remote from the people it rules, and even less subject to competition. There are some pretty hefty risks involved in such a proposition.

  21. Because it doesn’t ‘leave’ a bureaucracy in place, it creates or increases the powers of a centralized bureaucracy.

    For the worst-case scenario, see the bureaucracy in Brussels.

  22. * spends the entire 1NC debating topicality for every word in the prompt *

    * Introduces a bunch of new stuff in the 2NC so that he can bring it up again in the 1NR without time for the Con team to debate it *

  23. quasibill-

    I have to ask, how much authority will this bureaucracy actually have, and will we pay any attention to it?

    jon-

    I loved being 2nd negative. I got a ton of time to put my speech together, I got to set the tone of the debate by engaging in the first real clash with the first cross-ex. (Face it, 1AC isn’t a debate, it’s a speech.) I could put out a ton of new arguments in 2NC, and the 1AR could only respond directly rather than offer new counter-arguments. And if 1AR did offer new counter-arguments, in 2NR I could point that out to the judge.

    Almost as much fun as 2nd affirmative, who got the last word.

  24. I’m not sure where I stand on this either, but I will echo the belief that Paul’s stand is not a matter of “the perfect being the enemy of the good” but rather a belief that by creating additional bureaucracy to manage trade we are doing more harm than the good of lowering tariffs. And it would be ironic if this group were to trivialize the Constitutional puritism we’ve lauded Paul for in the past!

    Personally, I hesitate to worry too much about bureaucracy that has no direct (coercive) enforcement power as an attack on sovereignty. Not having read the treaty, I assume all this group could do is institute trade sanctions, which individual countries could do without it. One could look at such a body as nothing more than providing the means to discuss, coordinate and codify responses to trade disagreements. But then…I don’t know if it’s a healthy thing to set up a decision making body if what makes it okay is that we could always ignore it.

  25. Please forgive the threadjack, but a bunch of regular posters from the Connecticut-New York-New Jersey area have been talking about meeting up in Manhattan some weekend, to drink, solve all the world’s problems and find out how wrong we were when we imagined what the others looked like. So far I’ve got seven posters, one lurker and a Reason staffer on board–if anyone else is interested drop me an e-mail. Right now we’re looking at a Saturday evening in the latter half of August, or early September.

    You may now resume talking about how our country’s going straight to hell.

  26. kwais,
    When are you going to be in Chicago? I’m going to be driving to South Bend starting on Weds. and Chicago is right on my way. I should be there August 6 and would probably need a beer at that point. 🙂

  27. Thoreau,

    I hate to answer a question with a question, but I think it gets to the heart of why I side with Dr. Paul:

    How authority was the Federal government supposed to have?

    As to whether we will pay any attention to it – we’ve pretty much respected all the other such organizations, such as the WTO, but even granting that we can ignore it – why create it, then? Why not just pursue free trade policies on our own, as we know that the benefits accrue to us as a whole when we do act in protectionist manner, even if others do enact protectionist schemes? Why create a bureaucracy at all, if all your doing is pledging to voluntarily not enact protectionist measures?

  28. ugh, wow, my typings is really bad today.

    “How [much] authority was the Federal government supposed to have?”

    “as we know that the benefits accrue to us as a whole when we do[n’t] act in protectionist manner”

    Maybe I need more sleep.

  29. I did debate team AND Academic Decathlon. Yeah, that’s right.

    I still don’t understand how I ever managed to get laid.

  30. Um, “how much authority will this bureaucracy actually have, and will we pay any attention to it?”

    Heard of NAFTA’s Chapter 11? CAFTA bolsters the type of bureacracy we’re already paying millions of dollars worth of attention to.

    From those friends of freedom at Public Citizen (but the basic point is made thousands of different places, I’m just too lazy to dig up a better link):
    http://www.citizen.org/trade/nafta/CH__11/index.cfm

    The North American Free Trade Agreement (NAFTA) includes an array of new corporate investment rights and protections that are unprecedented in scope and power. NAFTA allows corporations to sue the national government of a NAFTA country in secret arbitration tribunals if they feel that a regulation or government decision affects their investment in conflict with these new NAFTA rights. If a corporation wins, the taxpayers of the “losing” NAFTA nation must foot the bill. This extraordinary attack on governments’ ability to regulate in the public interest is a key element of the proposed NAFTA expansion called the Central American Free Trade Agreement (CAFTA).

    NAFTA’s investment chapter (Chapter 11) contains a variety of new rights and protections for investors and investments in NAFTA countries. If a company believes that a NAFTA government has violated these new investor rights and protections, it can initiate a binding dispute resolution process for monetary damages before a trade tribunal, offering none of the basic due process or openness guarantees afforded in national courts. These so-called “investor-to-state” cases are litigated in the special international arbitration bodies of the World Bank and the United Nations, which are closed to public participation, observation and input. A three-person panel composed of professional arbitrators listens to arguments in the case, with powers to award an unlimited amount of taxpayer dollars to corporations whose NAFTA investor privileges and rights they judge to have been impacted.

  31. The bete noire of Chapter 11 is a case in which a Canadian manufacturer of the gasoline additive MTBE sued the State of California for banning MTBE, after it was discovered to be poinsoning water supplies.

  32. Mo,
    I could be there as early as this Sunday. I am not sure exactly wich day I will be there, I will email when I know more.

  33. Ron Paul’s objections, based on the document linked at http://www.lewrockwell.com/paul/paul254.html, seem to be more focused on the issue of Congress’ soveriegnty, and of ceding power to an international body. This objection seems legitimate to me.

    nmg

  34. Why not just pursue free trade policies on our own, as we know that the benefits accrue to us as a whole when we don’t act in protectionist manner, even if others do enact protectionist schemes?

    WHEREAS, the Theory of Comparative Advantage is 190 years old and is supported by so much theoretical and empirical evidence that it is both tragic and comical that it is still debated; and

    WHEREAS, the benefits of free trade accrue most strongly to those societies without trade barriers irregardless of what other societies do;

    THEREFORE, be it resolved that the United States unilaterally drop all trade barriers on all imports of products and services which may be produced legally in the United States;

    BE it further resolved that the United States unilaterally drop all trade barriers on all exports of products and services save those that are necessary for the territorial security of the United States.

    …yeah, that’ll get 3 votes between the House and Senate.

    All of us here know that CAFTA should be half a page long. But the extra hundreds of pages weren’t put in there by free trade’s supporters: they were put in there by free trade’s opponents. It’s either this CAFTA or no CAFTA. Purely free trade is not an option.

    It is so very rare that legislation passed by Congress nudges things in the direction of freedom. I think it’s a day to celebrate.

  35. “It is so very rare that legislation passed by Congress nudges things in the direction of freedom. I think it’s a day to celebrate.”

    Well, I’m always suspicious when government begets MORE government under the excuse of making us more free.

    Something in the equation doesn’t quite add up.

  36. Julian,

    What is the argument for (2)? If the bill is suboptimal (which everyone seems to agree), it will naturally lead to suboptimal results and consequences which will, in turn, be used to unfairly tar the concept of free trade (and thereby reduce the free trade “momentum”). Is it better to take an _incremental_ step while bearing such a burden (sugar subsidies, Big Pharma exceptionalism, international, quasi-governmental bodies) or is it better to fight for a better bill? I just think its reasonable to argue that you should fight for better legislation now.

    Again, I’m not trying to make an idealistic point. I’m just wondering about the long view. Certainly a plausible anti-free trade policy is to attach more and more cumbersome riders to such agreements so as to poison the outcomes — it is win-win, since the anti-free trade industries retain their unfair practices and “free trade” gets a bad name.

    I am certainly not an expert in this area, and I’m interested in your arguments for (2) — what positive aspects of CAFTA will outweigh, in the long runs, its negative aspects.

    Anon

  37. nmg,

    Interesting question, what is this sovereignty thing anyway? I wonder if by the same logic all treaties would be considered a surrender of sovereignty, since treaties by their very nature tie the hands of our own government in deference to the wishes of one or more foreign governments? The only difference I can see offhand with setting up a bureaucracy to enforce a treaty (in terms of sovereignty) is that it creates the condition to tie our government’s hands in ways that are not specified in the treaty, and thus, in a sense, unpredictable. But as long as the treaty is ratified by the Senate with the understanding that the treaty does this, is it really any more of a surrender of sovereignty than any other binding treaty? That said, it reminds me of the debate over regulatory agencies, which are created by acts of Congress but which then act on their own theoretically in accordance with Congress wanted them to do based on said acts. This of course has been upheld by the Supreme Court, but like many here, I’ve often found such delegation of Congressional powers dubious. Hmmmm….

    joe,

    Could you find it in your heart to tell me what the outcome of that bete noire case was? I do remember something about it, but I sure don’t remember how it turned out!

  38. Free Trade is the trade for me, but CAFTA seems like a lot of paperwork to get across a free trade message. I’m all in favor of busting up the HFCS lobby. I’d rather have actual sugar in my soda anyway.

  39. Before CAFTA, did we have ABSOLUTELY NO trade with Central America? I don’t know the answer, but somehow I doubt that. Is CAFTA’s managed “free” trade replacing existing managed trade or no trade whatsoever?

  40. Okay, I just read Ron Paul’s statement cited above. The objections with respect to sovereignty are worthwhile, but I still believe CAFTA is more positive than negative, even in that light.

    First, Congress does a pretty poor job with the sovereignty it already feels it has accrued. I frankly trust free trade adjudication to some other body whose interest is free trade much more than I trust it to Congress whose interest is most decidedly _not_ free trade.

    Second, the sovereignty being ceded is quite low powered and can be overruled at any time by any act of Congress and many acts of the Judiciary.

    Finally, if and when Congress does feel the need to make a stand against some body arbitrating one of these FTAs, I suspect their motivations and actions will be anti-free trade. They may be couched in language like “taking back our sovereignty”, but I am pretty confident that Congress will “take back their sovereignty” to further violate the sovereignty of the individuals under their purview. It’s their favorite pastime!

  41. I look forward to the day when jobless, income-less Americans will have nothing better to do then to shoot anyone wearing a suit and anyone with a foreign accent.

  42. “I frankly trust free trade adjudication to some other body whose interest is free trade much more than I trust it to Congress whose interest is most decidedly _not_ free trade”

    Question: (damn, I’m doing it again):

    Who do you think will be appointing the members of this other body, and why do you assume their interest will be free trade?

    Compare it to the SCOTUS – has anything about the history of that body indicated to you that its interest is faithfully interpreting the Constitution?

    Again, I can understand, and agree with, the sentiment that something that at least pretends to be about free trade is better than 90% of what government puts out. But this isn’t really about free trade – it’s about creating another layer of government. I think that should at least give a libertarian reason to pause when evaluating the bill.

  43. Harrumph. I’m flashing back half a lifetime to being the only full-time L/Der among C/Xers… 😉

  44. But this isn’t really about free trade – it’s about creating another layer of government. I think that should at least give a libertarian reason to pause when evaluating the bill.

    It won’t be perfect. You note yourself that SCOTUS is not perfect. And yet I suspect you think history has been better with a SCOTUS, however imperfect and poorly chosen, than without.

    The argument is the same here. This free trade adjudicating body is not really another layer of government. Rather, like the Supreme Court, it is another roadblock in front of Congress, impeding their quest to appropriate the people’s individual sovereignty.

  45. Lincoln-Douglas is by far the superior form of debating. Nobody could ever win a CX debate about Juvenile Incarceration with “Community Bloodsport” as a value, or an Iraqi Sanctions debate with “The (continued)Fall of the Ottoman Empire” as a criterion.

  46. Joe,

    But MTBE was supposed to save the air? Did the Canadian company sue the Sierra Club and every other marxist environmental wacko organization who shoved MTBE down our throats without proper testing?

  47. Odd, I was on the debate team and got plenty of poon…

    Anyway, Ron Paul is right on this one. I’m not expecting “perfect” free-trade, but what we keep getting isn’t even decent. We seem to like trade to only go in one direction here, despite that obviously making no sense. Free-trade being as simple as erasing restrictions we currently have is currently an ideal off into the future, but that in no way means that we cannot demand that whatever “trade agreements” are set on the table do not put in place further restraints.

    Pragmatism doesn’t dictate that you must not distinguish between walking uphill and merely rolling downhill at a slower speed.

  48. Shem, nobody should ever win a LD debate about Juvenile Incarceration with “Community Bloodsport” as a value, or an Iraqi Sanctions debate with “The (continued)Fall of the Ottoman Empire” as a criterion.

    Eric, my team had the exact opposite problem. Spent four years trying to convince someone-anyone-to do CX for us, but we could never manage it (had something to do with the fact that our novice CX debaters didn’t have any senior CX debaters to borrow files from).

    b-psycho: it was always my impression that one of the great benefits of debate team was meeting the girls who were nerdy enough to want to hook up with you. Lots of people got up to lots of stuff at those hotels…unfortunately, I was never in on it 😉

    And the rest of you will be pleased to know that the nuclear war disad is as popular as ever, although the resolutions committee did successfully preempt the absudity a couple years back (by actually making the topic about WMDs).

  49. Shem, I won a C/X debate using the affirmative’s global warming disad to counter their own ice-age disad, as well as claiming that war in Russia was a net win for the US.

    Also… we lost while trying to claim that the HARRP disad (some weather control thing the DOD is supposed to have) was something that Dr. Doom cooked up to foil Spiderman, because we couldn’t find any tags for Spiderman Solves.

    I had a lot of fun in C/X… didn’t win much… but I was out to have fun, not to speak 5,000,000 wpm and take copious notes. I had a couple tubs full of info and a strange sense of logic.

  50. Eric, my team had the exact opposite problem. Spent four years trying to convince someone-anyone-to do CX for us, but we could never manage it (had something to do with the fact that our novice CX debaters didn’t have any senior CX debaters to borrow files from).

    Interesting. As I’ve hinted, my team was a legion of C/Xers and some dramatic interp folks. I was the only full-time L/Der, though sometimes one or two would join me for a tourny or two. It seemed to be a common situation (for some unknown reason) in East and Central Texas when I was in high school.

  51. Hmm..are we getting off topic here with the discussions or is it just me? Maybe it’s just my (liberterian) opinion but this seems to be happening with a lot of the posts lately..can we maybe just keep the comments on the specific topic at hand?

  52. I wonder what the proportion is of libertarians that were on the debate team in school compared to the rest of the population politically…

    There oughta be a survey.

  53. Eric: I think it’s largely a matter of inertia. We had lots of LDers, so new kids tended to do LD. Y’all had lots of CXers, so new kids tended to do CX. Also, all the kids on my team were just plain lazy (me especially), so no one wanted to cut hundreds of cards. I mostly pulled my cases out of my ass-I’d pace around the debate room and come up with grand unified theories of the topic, and then I’d try to make positions out of them. Not as successful as I’d have liked because [insert obligatory exegesis on the poor mental fortitude of the average judge here], but I had fun.

    b-psycho: I think there are a couple selection biases working here-among other things, the people who post on this forum, specifically, are the sort of people who enjoy getting into arguments and political discussions with strangers. I was commenting to a friend the other day that I tend to forget that most people don’t consider a political argument the ideal end to a conversation (with most people. Some people, the ideal end would be getting laid followed by a political discussion. Or a political discussion, followed by getting laid. Or, hey, I’m not picky-if they’re really busy I’ll settle for both at once).

    Mark Delinus: I suppose we could keep the comments on the specific topic at hand, but where’s the fun in that?

  54. The First Rule of HS Debate:

    Some jackass ‘expert’ has at some point said something that fully supports every lunatic thesis it is possible to conceive.

    Cross X was the best part of debate. 1A was the worst.

  55. I always wanted to do Lincoln-Douglas, but my school didn’t do it, and my coach said he’d be willing to give it a shot but there weren’t many LD teams in the area. So in the off-season (debate season was in the fall) I kept in shape by doing Extemp at forensics festivals.

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