Dominican Republic-Central America-United States Free Trade Agreement Implementation Act

DOMINICAN REPUBLIC-CENTRAL AMERICA-UNITED STATES FREE TRADE AGREEMENT IMPLEMENTATION ACT

BREAK IN TRANSCRIPT

Ms. CANTWELL. Mr. President, today, I proudly announce my support for S. 1307, a bill implementing the Dominican Republic-Central America-United States Free Trade Agreement, or CAFTA. There is much in CAFTA that helps Washington State.

I generally support trade agreements such as CAFTA because I believe that free trade is the best way to raise the standard of living for all Americans and for all people in other countries with which we trade. I believe that once other nations have access to our goods, culture and ideas, we will find that the world will adopt the best attributes of America, including our values.

The alternative to supporting CAFTA is unworkable. If CAFTA fails, the Nation's efforts to negotiate future trade agreements will be badly damaged. Congress has to pass CAFTA because it offer benefits to all CAFTA signatories, and because in light of the broader trade context our negotiators would suffer a setback if CAFTA does not pass.

Washington State has historically benefited from liberalizing trade laws. For example, in the first year following the United States-Chile Free Trade Agreement, Washington State exports to Chile more than doubled. And since NAFTA passed in 1993 Washington exports to Canada and Mexico have increased by 130 percent.

CAFTA promises to confer some of the same benefits on Washingtonians. CAFTA makes all U.S. exports to the CAFTA countries duty free in 10 years, and most of these tariffs are eliminated immediately. U.S. exports to these countries are often subject to tariffs, and CAFTA brings us closer to trade parity. In particular, Washington State's pear, cherry, apple and potato growers will see most tariffs on their crops immediately reduced to zero as soon as CAFTA is implemented. These farmers have low enough profit margins without having to contend with high tariffs on their goods, and tariffs place our farmers at a competitive disadvantage with farmers in other countries that are not subject to high tariffs. Our farmers need and deserve better conditions for selling their goods to the seven CAFTA countries.

In total, Washington State exported $113 million worth of goods to CAFTA countries in 2004, including oil and coal exports, crops, computers and electronics, processed foods, machinery manufactures and paper, and Washington's trade relationship with CAFTA countries increased by 251 percent from 2000 to 2004. These goods are heavily tariffed under current international trade laws with the CAFTA countries.

But under CAFTA, Washington's apple and pear growers will see duties that are currently up to 25 percent on their goods reduced to zero, and our grape growers will see 20 percent tariffs zeroed out. Tariffs on Washington's raspberry growers will be phased out over 5 to 15 years, depending on the CAFTA country, and our dairy farmers, some of whose products are subject to 60 percent tariffs, will see those tariffs phased out over 20 years. The Washington beef industry will see 30 percent
tariffs immediately eliminated on some of their products, and other beef product tariffs will be phased out over 10 years. Wheat and barley duties are zeroed out immediately, and potato growers will see some tariffs immediately eliminated and most others phased out over 15 years.

Washington State is likely to see its exports to CAFTA countries dramatically increase over time, once CAFTA is enacted. For example, Northwest Washington is likely to see its agricultural exports to CAFTA countries increase as CAFTA is gradually implemented up until 2024, from $2.1 million to $3.8 million, and Central Washington is likely to see agricultural products shoot up from $14.5 million to $22.4 million during the same 20-year stretch. These heavy increases mean more jobs for Washingtonians, at a time when the State is just now turning things around economically.

Nationally, CAFTA is also important. CAFTA countries make up the tenth largest export partner for American goods, making that region a larger trading partner for the U.S. than Australia, Brazil or India.

While I support CAFTA, I acknowledge that it could do more to protect labor rights in the CAFTA countries, it could be better on the environment and it could better take account of human rights in those nations. Therefore, CAFTA should not be seen in a vacuum. CAFTA is merely one part of what must be a larger strategy for addressing our workers' needs in a rapidly evolving world economy, and for addressing the economic and political problems of our neighbors to the South.

I firmly believe that in the long run, encouraging export-led growth in developing countries will help raise incomes, tighten labor markets, and improve job standards in those countries. Opening markets will drive political changes too. Open markets and democracy are the two prevailing political ideas of the present, and they will become even more prevalent in the future. America has to remain the leader in exporting these powerful ideas to the entire world, and CAFTA is one more step we can take to accomplish this.

I also strongly believe that our trade policy should couple trade liberalization with worker retraining and other creative, proactive and responsive forms of labor assistance. Globalization will happen no matter what. So we need to be prepared for these changes, and help assure that America's working families do not take the brunt of them.

That is why I am working with my colleagues to fully implement improvements to the Trade Adjustment Assistance Program, TAA. TAA provides workers with access to retraining programs, income support, and other benefits when they lose their jobs due to trade. And TAA works--the Government Accountability Office reports that after TAA was last modified, most workers are enrolling in training services sooner, from 107 days in Fiscal Year 2002 to 38 days in Fiscal Year 2003.

TAA must be expanded. We should raise the cap on TAA funds, since 35 States in Fiscal Year 2004 did not have sufficient funds to cover funds those States obligated and paid to TAA-eligible workers. After Trade Promotion Authority passed, we doubled the TAA program to help cushion difficult transitions of workers whose jobs are lost because of trade. We should plan ahead and increase TAA again, to coincide with enactment of CAFTA.

TAA and similar programs must also work better. We must plan ahead for changes in our economy--these changes are inevitable, and our long-term plan at training our workers to be prepared for these changes will determine whether America competes in the global market.

The 21st century marketplace is dynamic, and public policy must also be flexible if we are to best take advantage of these changes. As our economy continues to shift from a predominantly manufacturing base to a heavy service sector economy, government programs such as TAA must continue to reflect these changes.

Specifically, I support proposals such as the Trade Adjustment Assistance Equity for Service Workers Act, which would enhance TAA by extending the program to service sector and secondary service workers. Currently only manufacturing workers qualify for these benefits. Including service sector workers merely reflects the realities of our economy--America will lose somewhere between 500,000 and 3 million service sector jobs to other countries in the next 10 years. I want to emphasize that these are not net job losses, but they will result in people being displaced. People with service sector jobs have families in need just as sure as manufacturing workers do. They should share in the TAA program.

We can also close loopholes that make it difficult for some older workers to participate in an add-on to TAA that was meant specifically for them. Now that we have identified these loopholes, it is good government to close them. Our older workforce, some of whom are not the ideal candidates for longer training courses, will benefit from closing these loopholes and once this is done they will be placed in new jobs more quickly.

Those concerns, especially about the need to make preparing our workforce for the global economy a higher priority, can be addressed by Congress and the administration in the coming months, and I will work to achieve these goals moving forward. I ask unanimous consent that a letter from Ambassador Portman be printed in the RECORD.

Ms. CANTWELL. Mr. President, though we have much to do to make opening markets fairer to all those affected, CAFTA is good for Washingtonians, especially our farmers, it is good for America, and in the long run it will be good for the people living in CAFTA countries too. I will vote for CAFTA and continue to work to maximize what Washingtonians get out of globalization, while also working to minimize the negative side effects that sometimes result from it. Aggressively balancing the impact of opening markets is the track we must all accept. America's economic future hangs in the balance.

There being no objection, the material was ordered to be printed in the RECORD, as follows:

BREAK IN TRANSCRIPT

http://thomas.loc.gov/