Some Democrats in Congress, including Rep. Rick Larsen (D-Everett), have taken a principled stand against an important free-trade agreement. While we applaud the reasoning, its target is too important to be shot down.
At issue is the Central American Free Trade Agreement (CAFTA), a deal that would eliminate most barriers to U.S. goods going to Central America and the Dominican Republic. The agreement, which needs the approval of Congress, would open those small but growing markets to U.S. agriculture, technological and other exports, and would institute stronger intellectual property rights to protect U.S. copyright holders. Most Central American products already come here duty-free.
As a leading exporter, Washington benefits greatly from free trade. That’s why Larsen normally is on the side of free-trade agreements. What’s his objection to this one?
“There are some problems in CAFTA that are not insurmountable,” Larsen said. “But you can’t divorce trade policy from a competitiveness policy.”
That’s where he believes the Bush administration and the Republican-controlled Congress have come up short, and he’s right. Funding for research and development, the seed money for innovations tapped by leading research universities, has been slashed. Growth in funding for college scholarships such as Pell grants hasn’t nearly kept up with rising tuition costs.
Such short-sightedness, Larsen argues, is making the United States less competitive globally. Competitiveness and free trade must work together for either to be effective, he says.
Indeed, Congress and the president should be working to advance both. The burgeoning U.S. budget deficit, however, is crushing the kind of funding Larsen is advocating. It’s just one reason among many that the massive tax cuts the president and his congressional allies are so fond of shouldn’t be make permanent – at least not in the highest income brackets. Those tax cuts and the unmitigated costs of the war in Iraq have snuffed out the flexibility to make many wise investments here at home.
Still, CAFTA is a good agreement, and Congress should approve it. Two decades ago, Central American counties like El Salvador, Nicaragua and Guatemala were bloody battlefields. Among the ways to keep these fragile democracies free is to help them build stable economies. That’s what free trade can do.
CAFTA provides for the enforcement of labor and environmental laws. Stiff fines are imposed for violations, and that money goes to further bolster enforcement. Currently, there are no such enforcement mechanisms, making CAFTA a strong step in the right direction.
The Bush administration is right to back CAFTA. It should, however, make free trade even more meaningful by taking stronger steps to keep America competitive.
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