Rep. Salazar: U.S., state agriculture and taxpayers will suffer from burdensome pact

By Rep. John Salazar
July 23, 2005

I came to Congress to defend the values of rural Colorado. Our farming lifestyle, our ranching communities, our jobs. DR-CAFTA, the Dominican Republic-Central America Free Trade Agreement goes against those values, posing a threat to the very backbone of our economy and our lifestyle.

DR-CAFTA is an attempt to liberalize trade between the United States and six Latin American countries. The agreement was negotiated and agreed to in 2004 and is awaiting congressional approval. Due to Fast Track Authority, however, Congress will not have an opportunity to amend the agreement - it will merely have an up-or-down vote regardless of any concerns that may be voiced. DR-CAFTA has divided many agricultural groups among the states as well as a variety of other industries, business groups and human rights organizations.

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The promise of new markets for agricultural exports has prompted many groups to throw their weight behind DR-CAFTA, but a deeper examination of the supposed benefits vs. the actual consequences of DR-CAFTA's enactment warrants hesitation.

Our beef industry is strong and fiercely protected in our state. According to the proponents of the deal, DR-CAFTA will open up new markets and opportunities for the U.S. beef industry. But our local ranchers and beef producers will not benefit from the agreement - DR-CAFTA will only allow duty-free access for prime and choice cuts of U.S. beef, which makes little sense when 40 percent of the people in DR-CAFTA nations make $2 a day or less. I doubt they can afford our New York strips and porterhouses.

Meanwhile, DR-CAFTA is silent on the issue of imports meeting our rigorous food safety and sanitary standards, creating a challenge to the safety of our food supply.

The Colorado Farm Bureau has publicly expressed its opposition to this agreement because of the potential adverse effects it would have on agricultural sectors. In particular, the Colorado sugar industry could be devastated by increased imports of sugar from the Dominican Republic. According to estimates, the effect of lower sugar prices after increased imports could be nearly $180 million. This means the loss of nearly 150,000 sugar-industry jobs. A report prepared by the United States International Trade Commission estimates job loss in the sugar industry will be 38 times higher than the next most harmed sector.

Another government report reveals information condemning DR-CAFTA as a burden on taxpayers. According to the Congressional Budget Office, the influx of sugar from Central American countries would push prices down so low that our own sugar farmers would be forced to forfeit government loans on their crops. These forfeitures would cost taxpayers about $50 million annually through 2015. Not only would DR-CAFTA threaten the livelihoods of thousands of U.S. sugar farmers and workers, but it would cost taxpayers millions of dollars. When added to a trade deficit that has ballooned to $617 billion, claims of economic gain are hard to believe.

The trade commission study states DR-CAFTA will actually accelerate the pace at which jobs are outsourced overseas. The North America Free Trade Agreement certainly hasn't set a good precedent, with estimates of nearly 900,000 jobs lost.

In the wake of NAFTA, Trade Adjustment Assistance programs were designed to assist those who lose their jobs as a result of companies moving out of the United States. More than a decade after NAFTA, the programs receive only one-quarter of the needed funding. Despite progress made in recent years to improve the Trade Adjustment Assistance program, budget cuts have left many workers who qualify for TAA benefits without access to this program when they need it most. Workers in Grand Junction were displaced this year when their jobs were outsourced overseas; I would hate to see other communities have to deal with this problem.

How will the TAA programs keep up with DR-CAFTA's fast-paced outsourcing? And why spend millions of dollars to fix the effects of a flawed trade agreement, instead of renegotiating the entire agreement? Proponents of DR-CAFTA can't seem to defend the agreement on its own merits.

Since the solid economic reasoning isn't there, curbing illegal immigration has become the new purpose of DR-CAFTA, another argument that doesn't have the backing of facts or figures. In the wake of NAFTA, 1.3 million farmers in small to medium-size operations were forced off their land because they were unable to compete with the multinational producers. For those concerned about "broken borders," think of this: The employed farmers and agriculture workers of 10 years ago have become the undocumented immigrants of today. I fear DR-CAFTA will create a new wave of illegal immigration from Latin America.

I support trade as part of a long-term strategy to grow our economy. Economic ties with other nations help the American economy. But trade agreements should provide real gains for U.S. workers and businesses. In any agreement, we must be vigilant about protecting our economic security. DR-CAFTA is a flawed agreement that needs to be renegotiated to address the concerns of our agricultural sector and the concerns of illegal immigration. Safeguards to protect American jobs and rural values must be strengthened before moving ahead with free trade in Latin America.

Rep. John Salazar, D-Colo., is in his first term in the U.S. House of Representatives.