One Small Step for Free Trade in the New World…


…one even smaller step for free trade around the world?

Prez Bush has signed the Central American Free Trade Agreement into law. The deal, subject to all the sickening compromises that shower money on heavily protected industries, barely squeaked by despite Bush's hard sell, an indication that support for freer trade or for Bush as a second termer–or both–is on the ropes.

From the SF Chron:

The close votes give rise to questions about whether a hobbled administration will have the political clout to implement its sweeping free- trade agenda. The administration is talking with Thailand, several southern African nations and Andes mountain nations about creating separate free-trade agreements with them….

Bush is also pushing the Doha Development Agenda, which would lower global agricultural subsidies and tariffs, at the World Trade Organization's ministerial meeting in December. And the administration is committed to creating a Free Trade Area of the Americas, which would include every nation in the Western Hemisphere except Fidel Castro's Cuba.

Whole thing here.

NEXT: Juan Gets An "F"

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  1. Nobody loves me,
    Everybody hates me,
    Think I’ll go and eat worms…

  2. I can’t get excited about any “agreements.”
    If the President wanted free trade, how much could he do on his own?
    e. g. No subsidies. No embargoes. No price supports. No tariffs…
    If he would first do everything within his legal powers, then, and only then, might I begin to pay attention to agreements. Although I doubt that any agreements would be necessary, really.

  3. Good news: On June 9 the House voted to stay in the WTO 338-86.

    The close CAFTA vote had more to do with China and angry Dems than it had to do with how people feel about free trade.

  4. Ruthless, to be fair, Bush did bring up lowering subsidies at the G8 meetings. He was shot down by the Euros, of course.

  5. Bush did bring up lowering subsidies at the G8 meetings.

    As I believe Ruthless was alluding to, actions speak louder than words. Bush is empowered to do all sorts of things regarding Free Trade without sitting around and waiting for the Europeans. I tuned out Bush’s rhetoric long ago.

  6. Speaking of free trade within our borders, this story is both strange and sad. Especially the mindset of the people involved.

    Little boys’ lemonade stand shut down for lack of permit

  7. The US Constitution establishes free trade in remarkably brief fashion:

    Art. I, Sec. 8: The Congress shall have Power … To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;

    Art. I, Sec. 9: No Tax or Duty shall be laid on Articles exported from any State.

    No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another: nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another.

    Art. I, Sec. 10: No State shall … pass any … Law impairing the Obligation of Contracts …

    No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it’s inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress.

    Art. IV, Sec. 1: Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.

    Why, then, must the core documents of NAFTA, CAFTA, WTO, GATT, etc., be so voluminous? If the US Constitition can do the job on one page, can’t NAFTA, for example, do it in, say, 100 pages, instead of the thousands of pages it now uses?

    I conclude that any huge document that purports to be a “free trade” agreement is a fraud: either the same thing can be said with much less verbiage (in which case, it ought to be); or the verbiage that is employed establishes very tightly micro-managed, UNfree trade, indeed.

    Which is it in CAFTA’s case?

  8. I know it’s really hip and cool to belittle Bush no matter what he does, and it is true that he could lower/remove American trade barriers all on is own (although Congress, mostly Dems but also Reps, would be opposed). However, he did expand a lot of political capital on CAFTA and he and his party are relatively committed to free trade. Maybe he is not as pure as we are here on this site, but in the real world, he is doing what can be done. Remember, he doesn’t want to
    become a unilateralist…

  9. James provides the evidence I needed to suggest that Ruthless shouldn’t confine himself to blaming GWB. The collected meatheads in Congress are the ones with the power. The President is the figurehead and negotiator with foreigners, but he doesn’t make the rules alone.

  10. Libertarians might enjoy Ron Paul’s CAFTA: More Bureaucracy, Less Free Trade: It is absurd to believe that CAFTA and other trade agreements do not diminish American sovereignty. When we grant quasi-governmental international bodies the power to make decisions about American trade rules, we lose sovereignty plain and simple.

    Gosh, maybe this CAFTA thing is about something a bit more… sinister than just free trade. Libertarians won’t enjoy this, but perhaps they should consider what’s really going on and what they’re being sold.

  11. Ron Paul’s blatantly wrong in his CAFTA article. He says that CAFTA codifies and provides for enforcement of the International Labor Organization’s labor law guidelines, when, in fact, the text of the “encourages” nations to enforce their own labor laws.

    Here’s the full text for those who are curious, and here’s (pdf) the section on labor that Paul gets 100% wrong.

    Paul: “CAFTA also imposes the International Labor Organization?s manifesto, which could have been written by Karl Marx, on American business.”

    CAFTA: Article 16.2
    1(a). “A Party shall not fail to effectively enforce its labor laws…” after entering into the agreement.
    1(b). “Each Party retains the right to exercise discretion with respect to investigatory, prosecutorial, regulatory, and compliance matters and to make decisions regarding the allocation of resources to enforcement with respect to other labor matters determined to have higher priorities.”

    Ron Paul should be able to do better than that.

  12. “The close CAFTA vote had more to do with China and angry Dems than it had to do with how people feel about free trade.”

    I agree. If the vote had represented the public’s feelings about Free Trade, up or down, it would have lost in a landslide.

    Like it or not, in order to get a barrier-reduction bill through, the true believer free traders need to make some sausage. Republican sausage means huge taxpayer giveaways to favored industries. Democratic sausage means conditioning the reduction in trade barriers on the adoption of workers rights, environmental conditions, and expanded civil liberties in developing nations.

    So, realistically, you’ve got three choices – no reduction in barriers, expanded subsidies to Big Sugar or whomever, or companies going into El Salvador paying their workers what counts as a living wage in El Salvador. Pick one.

  13. Otherwise, yes, I’m in agreement with the above statements about free trade being created on a single sheet of paper.

    With headings in CAFTA like “Consultations on Trade in Chicken” and “Sugar Compensation Mechanisms,” it’s hard to make the argument that this isn’t micromanagement of trade.

  14. Ron Paul’s blatantly wrong in his CAFTA article.

    I’ve heard that CAFTA is either 1000 or 2400 pages. In either case, that’s a whole lot of pages. Have you read it all? Do you have a lawyerly mind, able to find the tiniest loophole to barge through?

  15. [C]ompanies going into El Salvador paying their workers what counts as a living wage in El Salvador.

    More like “companies going into El Salvador having to pay their workers close to what counts as a living wage in the USA, higher than the productivity of workers in El Salvador, making it not worth the trouble to go into El Salvador.”

    It is, of course, mostly micromanagement on exactly how slowly to force these nations– including the US– to ease the restrictions they already have. Sure, true free trade takes but a sentence. The existing morass of trade barriers takes many, many pages already, and the pages of these agreements are about which barriers go, when, and how fast.

  16. Mr. Thacker,

    I have never, not once, heard advocates of environmental and labor standards in trade deals suggest that those standards should be based on practices in the United States. When John Kerry was asked this very question in one of the primary debates – “Should we ask them to pay the American minimum wage?” he laughed out loud at the idea, saying, “Well, we could ask…” Everyone in the crowd immediately got the joke, and laughed out loud.

    Nice, big, fat straw man you’ve got there.

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