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Farming and your Freedom - CAFTA takes free trade south of the border - way south
By: Pete Graham 06/30/2005

Ag Secretary Mike Johanns, a man who has always stared free trade in the eye and liked what he saw, is on the stump for the admini-stration's Central American Free Trade Agreement (CAFTA), urging congressional support for its passage.
Johanns, in his days as Nebraska governor, was at the forefront of trade issues and understands the importance of expanded markets for U.S. producers. Sometimes creating those markets also creates inequities, and CAFTA has been accused of that, particularly by sugar producers. But, expanded and freer trade has also meant better markets for farmers in the Corn Belt, pork producers and others among them. Presumably, CAFTA would help with further expansion. The Dominican Republic is also part of the CAFTA "family" of nations.
Johanns, according to Dan Looker of the @griculture Online website from Successful farming, recently told a sympathetic audience of pork producers in Des Moines that their support of CAFTA among their individual members of congress is needed for passage. As Looker pointed out, pork producers are largely in favor of expanded trade agreements, seeing the expanded markets as more important than turf wars over tariffs.
Johanns said that under CAFTA, exports of U.S. food products would likely double and some 47 percent of those pesky tariffs would be phased out. Tariffs on bacon would stop immediately. Johanns told the producers, Looker said, that trade is of vast importance when you consider the fact that 95 percent of the world's population lives OUTSIDE the U.S.
Two of Iowa's five Congress members, Republicans Tom Latham and Jim Nussle, as well as State Ag Secretary Patty Judge, a Democrat, support CAFTA, but Nussle told Looker the bill still faces a tough battle in congress, primarily because anything that benefits agriculture is a hard sell to urban-oriented representatives. They tend to see the "subsidy" side of agriculture, not the way-of-life, business or food-on-the-table sides of agriculture.
One of the problems, Nussle has noted, may be the fact that CAFTA sounds like NAFTA. Protectionists, particularly those in labor unions who have seen their jobs go south, then to far-flung places in the world during the reign of the Clinton-era free trade agreement, are dead set against CAFTA, fearing the same kind of exodus for jobs and some perceived advantage to other nations at the expense of Americans.
To be sure, free trade does have a downside. It does have trade-offs as well as actual trade. There are jobs in certain sectors lost, while there are gains in other sectors. The hope is that it all works out as a positive in the end.
The push is on to get CAFTA through the House Ag Committee chairman Bob Goodlatte (R-Virginia) has announced his support for the bill, even though some members of the panel aren't so sure. Goodlatte said he is concerned about the nation's trade deficit with the six CAFTA countries. Our ag exports to them total $1.7 billion currently, but imports are at $2.4 billion, which puts our produces at a distinct disadvantage. If CAFTA is approved, more than half of our exports to those nations will become duty-free immediately. Goodlatte thinks that will level the playing field for American producers, sugar growers notwithstanding.
With our trade agreements, the U.S. constantly seeks to decrease tariffs on our products and eliminate export subsidies. CAFTA, proponents have said, will meet the goals and provide the U.S. with an opportunity to increase ag exports. "That's good news for America's farmers and ranchers," Goodlatte said.
Obviously, everyone hopes he and Johanns are right. The jury is still out on the long-term effects of NAFTA, so we have to hope that CAFTA, when passed, will show early and long-term benefits to the farm economy.
I'll see ya!