[Congressional Record (Bound Edition), Volume 151 (2005), Part 11]
[Senate]
[Pages 15012-15106]
[From the U.S. Government Publishing Office, www.gpo.gov]




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

  The PRESIDENT pro tempore. Under the previous order, the Senate will 
resume consideration of S. 1307, which the clerk will report.
  The legislative clerk read as follows:

       A bill (S. 1307) to implement the Dominican Republic-
     Central America-United States Free Trade Agreement.

  The PRESIDENT pro tempore. Under the previous order, there are 16 
hours for debate equally divided. The majority leader is recognized.


                                schedule

  Mr. FRIST. Mr. President, this morning we will resume consideration 
of the pending CAFTA legislation. Last night we began debate under the 
20-hour time limitation. We now have 16 hours remaining and we do not 
expect to use the entire debate time allocated. Chairman Grassley has 
indicated that he would not require all of the 8 hours remaining under 
his control. Thus, I hope we would be able to yield back some time, 
which would allow us to vote on this bill at a reasonable time today.
  As mentioned yesterday on a number of occasions, we have two 
additional appropriations measures to complete this week, one of which 
is the Legislative Branch appropriations bill. It is ready for floor 
consideration. That bill will require only a short debate and could be 
finished without a rollcall vote.
  Also, we expect to consider and complete the Energy and Water 
appropriations bill. It is possible we could finish both of those late 
tonight. It depends on how much debate time is used on the CAFTA bill 
and also how much time Energy and Water will require.
  We have a number of other items to be completed before our recess, 
including the highway extension, as well as some nominations. It will 
take a lot of cooperation and a lot of hard work to be able to complete 
all of this. Again, there is a possibility we could finish late tonight 
but, if not, we are going to complete all this business, including the 
two appropriations bills, by Friday, and we could have votes into 
Friday as well.
  We have our jobs and our tasks laid out for us. We need to stay here 
until we complete them before we leave for our recess.


                 Central American Free Trade Agreement

  Mr. President, I want to comment on the CAFTA legislation which we 
turned to last night, the Central American Free Trade Agreement. We 
will vote on final passage of that agreement later today. CAFTA is a 
good bill. It is a fair bill and an evenhanded bill that Members from 
both sides of the aisle should be able to support in that this 
legislation expands the market for America's goods and thereby grows 
jobs here at home.
  The agreement which President Bush signed in May of 2004 promises to 
eliminate trade barriers between the United States, Costa Rica, El 
Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic. 
By doing so, it will level the playing field and by leveling the 
playing field will stimulate economic growth which, in turn, will 
stimulate job creation. America's market is already open. Nearly 80 
percent of exports from the CAFTA region to the United States come into 
America duty free. Those barriers are already down.
  Under CAFTA, the six CAFTA countries would reciprocate and 
immediately allow 80 percent of our exports to enter their countries 
duty free, lowering that barrier. As a result, CAFTA will create our 
second largest export market in Latin America, behind only Mexico. From 
Washington State apples all the way across the country to Florida 
oranges, America's producers will thrive.
  This represents a tremendous opportunity both for sellers and buyers 
and for all the people who make transactions happen--again, economic 
growth, creation of jobs.
  If I look back--and become a little bit provincial--to my home State 
of Tennessee, we are the third largest agricultural exporter to the 
CAFTA countries. Last year Tennessee businesses sold $271 million worth 
of goods and services to the CAFTA region. Tennessee farmers and 
factory workers rely on exports for their jobs and their livelihoods. 
One plant, the Levi Straus plant in Powell, TN, for example, exported 
$34.8 million in apparel last year to these countries. The Memphis-
based company, Drexel Chemical, has been exporting to Guatemala for the 
last 30 years, since the early 1970s. Its chairman tells the Memphis 
Commercial Appeal newspaper that CAFTA would have a tremendous impact 
on her business.
  She has good cause to be optimistic. Since America signed NAFTA, the 
North American Free Trade Agreement, in 1993, Tennessee's combined 
exports to Canada and Mexico have grown a whopping 190 percent.
  Free trade grows America's businesses and puts more money in the 
pockets of America's families. It is estimated that NAFTA and the 
Uruguay Round generate $1,300 to $2,000 a year for the average American 
family of four.
  CAFTA will open the doors to 44 million new consumers of American 
goods.

[[Page 15013]]

More sales to Central America means more jobs right here at home. 
Strengthening our mutual economic interest also will strengthen our 
national security. Twenty years ago, only two of the CAFTA nations, 
Costa Rica and the United States, were established democracies. Today, 
all seven can be counted among the free nations of the world.
  Unfortunately, however, the forces of totalitarianism and oppression 
still hover on the edges of these young democracies. Fidel Castro still 
oppresses the Cuban people and denies them precious human freedoms. 
Hugo Chavez moves Venezuela closer and closer to Castro every day. 
These regimes tend to work to spread their brutal methods and 
totalitarian philosophies, trying to infect the rest of Latin America 
and we simply cannot let them succeed.
  The free nations of Latin America need our support. They deserve our 
support. That support can be reflected through CAFTA. By linking their 
economies with democratic capitalism, CAFTA will help gird these 
nations against the threats at their door. It will strengthen their 
democracies and provide a model for freedom, a model for freedom 
seekers--indeed, freedom seekers around the world.
  The Washington Post agrees that:

       CAFTA and similar alliances provide hard evidence of 
     America's lasting commit to strengthening alliances, fighting 
     global poverty, and creating the building blocks of 
     democracy.

  In 1823, James Monroe warned that continued European efforts to 
colonize the New World would endanger American peace and safety. He 
understood that advancing liberty throughout the world required that we 
begin in our own backyard.
  Since then, the United States has worked to protect the freedom and 
independence of our hemisphere. I urge my colleagues to support growth 
and prosperity. The United States has always stood for freedom and 
liberty around the world. Under CAFTA we will help keep the Americas 
moving forward.
  I yield the floor.
  The PRESIDENT pro tempore. Under the previous order the time on the 
Democratic side shall be divided with 5 hours under the control of the 
Senator from North Dakota, Mr. Dorgan, and 3 hours under the control of 
the Senator from Montana, Mr. Baucus.
  Who yields time? The Senator from Montana.
  Mr. BAUCUS. Mr. President, parliamentary inquiry: Does the other side 
of the aisle control any time?
  The PRESIDENT pro tempore. It was previously announced that there is 
16 hours for debate equally divided. The majority side is under the 
control of Senator Grassley.
  Mr. BAUCUS. How much time does he have?
  The PRESIDENT pro tempore. He has 7 hours 54 minutes.
  Mr. BAUCUS. Mr. President, I suggest the absence of a quorum, and I 
ask the time be equally divided between both sides.
  The PRESIDENT pro tempore. Without objection, it is so ordered. The 
clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Sununu). Without objection, it is so 
ordered.
  Mr. GRASSLEY. Mr. President, last night we started debate on the 
Central American Free Trade Agreement. Last night, in addition to the 
economic factors involved in the approving of this bill, I spoke about 
the national security importance of this Central American Free Trade 
Agreement. I also talked--as, obviously, we do on most trade 
legislation--about the benefits of the agreement to the U.S. economy in 
general. This morning, I will focus on the benefits of this agreement 
for U.S. agriculture.
  As a Senator from Iowa and as a person who lives on and has an 
interest in a family farm my son operates, I have major interest in the 
U.S. agricultural policies that benefit American farmers. Moreover, as 
chairman of the Finance Committee, I pay particularly close attention 
to trade issues as they affect agriculture.
  I consulted frequently with the U.S. Trade Representative during 
negotiations on this agreement, the Central American Free Trade 
Agreement. I do that because that is the responsibility my committee 
has under trade promotion authority, which is a process by which 
Congress delegates the process of our carrying out our constitutional 
responsibility of control over international trade to the President to 
negotiate because it is quite impractical for 535 Members of Congress 
to negotiate with foreign countries.
  U.S. negotiators went to great lengths to see that the Central 
American Free Trade Agreement would be a good agreement for American 
farmers. Their efforts were successful. The negotiations resulted in an 
agreement that is particularly strong for U.S. agriculture and the 
agribusiness community that affects so many nonfarm jobs throughout the 
United States.
  I am fully convinced that implementation of this Central American 
Free Trade Agreement by the United States is in the best interests of 
U.S. agricultural producers. That is why I go to great lengths urging 
my colleagues to support it.
  U.S. farmers and ranchers are well aware of the fact that the 
international playing field for agricultural exports is presently far 
from level. Average tariffs of other countries on imports of U.S. 
agricultural products in the case of most commodities is significantly 
higher than those imposed by the United States. That worldwide average 
would be 60-some percent of tariffs of U.S. agricultural products going 
into another country, whereas those same countries throughout the world 
bringing products into the United States face an average of only an 11-
percent tariff.
  It is common sense to negotiate other countries' tariffs against our 
agricultural products down some or a lot and hopefully down to a point 
where we are in a win-win situation for American agriculture and the 
nonfarm jobs involved in the processing and handling of agricultural 
products. That is our long-term goal. In fact, that is the goal we have 
right now in the Doha round World Trade Organization negotiations going 
on this year. That is for the entire 150 countries that are members of 
the World Trade Organization. We hope that Doha round is a major 
breakthrough for the reduction of high worldwide tariffs against 
agricultural products.
  Now, as this unequal situation I just described has clearly 
demonstrated, and specifically in this trade relationship we have 
between the United States and these five countries of Central America, 
over 99 percent of agricultural products from Central American 
countries coming to the United States currently come in here not with 
an 11-percent average tariff I talked about worldwide, they come in 
with hardly any duty--except for an occasional product--and are duty 
free right now. That is unfair to American farmers.
  When we send products down there, the average bound tariff of these 
five Central American countries is over 44 percent. The current trading 
relationship between the United States and the CAFTA countries is not 
only an unlevel playing field but also a one-way street. CAFTA farm 
products do not pay tolls to enter the U.S. market today. Yet U.S. 
agricultural products are charged hefty tolls to enter the markets of 
these five countries. This is all going to be changed by the Central 
American Free Trade Agreement. A downhill one-way street will become a 
level two-lane road.
  Under the agreement, the CAFTA countries will eliminate tariffs on 
virtually all products. U.S. tariffs will remain largely unchanged. 
After all, the vast majority of agricultural products of the CAFTA 
countries already enters the United States duty free. For example, the 
treatment under the agreement of the four major U.S. commodities--pork, 
beef, corn, and soybeans--demonstrates how the Central American Free 
Trade Agreement will remove disadvantages faced by U.S. agricultural 
producers. These commodities

[[Page 15014]]

are of importance not only to my State of Iowa but to most agricultural 
States in our country.
  The Central American Free Trade Agreement countries currently apply 
tariffs of up to 47 percent on imports of U.S. pork. Their bound rates 
reach as high as 60 percent. Under the agreement, these tariffs of the 
Central American countries will be reduced to zero.
  With beef, they apply tariffs of up to 30 percent on imports of U.S. 
beef. Their bound rates reach as high as 79 percent. Under CAFTA, these 
tariffs of the Central American countries will be reduced for our U.S. 
farmers to zero.
  The CAFTA countries currently apply tariffs of up to 45 percent on 
imports of U.S. corn. Their bound rates reach as high as 75 percent. 
Under the agreement, tariffs of CAFTA countries on corn, the 
predominant product we export, will be reduced to zero, with the 
exception of the Dominican Republic, in which case duty-free access 
will be locked in.
  Soybeans is another example. CAFTA countries currently apply tariffs 
up to 5 percent on imports of our soybeans and up to 20 percent on U.S. 
soybean oil. Their bound rates reach as high as 91 percent for 
soybeans, 60 percent for bean meal, and 232 percent for the soybean 
oil. Under the agreement, tariffs of the CAFTA countries on U.S. 
soybeans, bean meal, and soybean oil will be reduced to zero.
  The leveling of the playing field with regard to CAFTA countries will 
result in real gains for U.S. agriculture. According to the Farm Bureau 
Federation, CAFTA would increase U.S. agricultural exports to those 
countries by $1.5 billion at the end of the full implementation. CAFTA 
will result in dollars in the pockets of U.S. farmers and ranchers.
  Recognizing that CAFTA will profit their members, numerous 
agriculture and food organizations have expressed their support for 
this agreement. I have a letter from 73 such groups that back the 
agreement. These organizations represent diverse commodities produced 
in the area regions including among the 73 the Farm Bureau Federation, 
Soybean Association, Chicken Council, Corn Growers, Milk Producers, 
Pork Producers, Potato Council, Turkey Federation, Rice Federation.
  Moreover, six former U.S. Secretaries of Agriculture, both Republican 
and Democrat, have announced their support for the Central American 
Free Trade Agreement. Let me read those: Ann Veneman, Republican; Dan 
Glickman, a Democrat; Mike Espy, Democrat; Clayton Yeutter, Republican; 
John Block, Republican; Bob Bergland, Democrat. They all noted in a 
recent letter to Congress that they back CAFTA ``because the benefits 
are very significant and the costs are minimal.''
  I ask unanimous consent to have that letter printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

 Letter From Former Secretaries of Agriculture to Members of the U.S. 
              House of Representatives and the U.S. Senate

       Dear Member of Congress: As former secretaries of 
     agriculture, we understand the importance of negotiating 
     trade deals that minimize the costs and maximize the benefits 
     to U.S. farmers, ranchers, and food and agriculture 
     organizations. We support the Free Trade Agreement with 
     Central America and the Dominican Republic (CAFTA-DR) because 
     the benefits are very significant and the costs are minimal. 
     We urge you to pass CAFTA-DR quickly and without amendment.
       A vote for CAFTA-DR is a vote for fairness and for 
     reciprocal market access. Under CAFTA-DR all of our food and 
     farm products will receive duty free treatment when the 
     agreement is fully implemented.
       A vote against CAFTA-DR is a vote for one-way trade. 
     Virtually all of what we import from the six CAFTA countries 
     now enters the U.S. duty free as a result of the Generalized 
     System of Preferences (GSP) and the Caribbean Basin 
     Initiative (CBI). Yet, our food and agricultural exports to 
     these six nations are restricted significantly because of 
     high tariffs. As a result of the current one-way trade deal, 
     we are running an agricultural trade deficit with these six 
     countries.
       In addition, a formal trade agreement with the United 
     States will help ensure the economic stability and growth 
     that the region needs to avoid a return to the civil wars, 
     insurgencies, and dictatorships of the recent past. As 
     economic freedom and democracy take deeper root, incomes will 
     increase and demand for our food and agriculture products 
     will expand.
       Failure to approve CAFTA-DR will have a devastating effect 
     on U.S. efforts to negotiate trade agreements on behalf of 
     U.S. agriculture. The World Trade Organization Doha 
     Development Round would be dealt a serious blow. Other 
     countries would be less willing to negotiate with the United 
     States knowing that CAFTA-DR, a trade agreement so clearly 
     beneficial to U.S. interests, could be rejected by the U.S. 
     Congress.
       The future of American agriculture continues to lay in 
     expanding opportunities for our exports in the global 
     marketplace, where 96 percent of the world's population 
     lives. We must not forego these opportunities, especially 
     when the benefits to our nation are so unmistakable.
     Ann M. Veneman.
     Dan Glickman.
     Mike Espy.
     Clayton Yeutter.
     John Block.
     Bob Bergland.

  Mr. GRASSLEY. Most sectors of U.S. agriculture support the CAFTA. I 
realize one--sugar--is a commodity we did not have their support. I 
respect the sugar industry. They are very important. Outside of that 
group, we have agriculture represented behind this group.
  An economic study by the American Farm Bureau Federation confirms 
that CAFTA will not harm the U.S. sugar program or other agricultural 
commodities.
  While CAFTA is important in itself for U.S. agriculture, the 
implementation of this agreement would boost U.S. efforts to liberalize 
agricultural trade around the world. The implementation of CAFTA would 
give further momentum toward the completion of agricultural 
negotiations in the Doha Round of the World Trade Organization, 
negotiations in which the United States is seeking to cut tariffs, 
harmonize levels of domestic support, and eliminate export subsidies.
  Mr. President, CAFTA is a straightforward win for the bulk of U.S. 
agricultural producers. A current one-way trading relationship will 
end. The CAFTA countries will dismantle their tariffs to U.S. 
agricultural products while the United States will provide little 
additional access for CAFTA commodities. This will result in increased 
sales for U.S. agricultural exporters, sales of up to $1.5 billion a 
year by the end of the agreement's full implementation. Not 
surprisingly, CAFTA is widely supported in the U.S. agricultural 
community.
  The CAFTA is good agricultural policy and good trade policy. I urge 
my colleagues to support it.
  Mr. President, I yield to the Senator whatever time he needs.
  The PRESIDING OFFICER. The Senator from South Carolina is recognized.
  Mr. DeMINT. Mr. President, I rise to speak in favor of S. 1307, the 
CAFTA Implementation Act, because it advances America's economic and 
security interests. As someone who spent over 20 years in business 
before entering public service, I continue to be amazed by those in 
Washington who support outdated policies that make it harder and harder 
for American businesses to compete. Excessive taxation, regulation and 
litigation are driving American employers out of their minds and 
American jobs overseas. Yet too many politicians continue to support 
higher taxes, junk lawsuits, and trade barriers that effectively put 
signs on our beaches that say: Go do business somewhere else.
  If we are going to have the best jobs in the world, we must make 
America the best place in the world to do business. This starts by 
reforming our complicated Tax Code, reducing mindless Government 
regulations, and eliminating frivolous lawsuits that, together, add 
mountains of needless costs on our businesses. Creating a pro-business 
environment in the United States also means we must open international 
markets to American exports so our workers can compete on a level 
playing field. CAFTA, for example, would expand the market for U.S. 
goods with 44 million consumers in Costa Rica, El Salvador, Guatemala, 
Honduras, Nicaragua, and the Dominican Republic.
  Nearly 80 percent of goods from the six CAFTA countries currently 
enter the United States duty-free. Yet American exports are taxed 
virtually across

[[Page 15015]]

the board when they enter CAFTA markets.
  On U.S. motor vehicles and parts, CAFTA countries levy an average 
tariff of 11 percent, while the U.S. rate is zero. On vegetables, 
fruits, and nuts, the CAFTA region's average is 16.7 percent, again 
compared with zero in the United States. On grains, it is 10.6 percent 
to zero; and on meat products, it is 14.7 percent, while the U.S. rate 
is just 3 percent. CAFTA would eliminate these disparities.
  The agreement would level the playing field by eliminating 80 percent 
of the tariffs on American exports immediately, with the remaining 
tariffs phased out over 10 years. This would help exporters in my home 
State of South Carolina like BMW, Caterpillar and General Electric, as 
well as farmers and ranchers raising soybeans, peaches, pork, and 
poultry. The American Farm Bureau Federation estimates CAFTA could 
expand U.S. farm exports by $1.5 billion a year. Manufacturers would 
also benefit, especially in sectors like information technology 
products, agricultural and construction equipment, paper products, 
pharmaceuticals, and medical and scientific equipment.
  According to a recent economic impact study conducted by the U.S. 
Chamber of Commerce, in the first year alone CAFTA would increase 
output in South Carolina by $167 million and create over 900 new jobs. 
In 9 years, the study shows a potential increase in output across all 
industries of $701 million and the creation of over 6,000 jobs. The 
South Carolina State Ports Authority has told me CAFTA will contribute 
to greater economic development in South Carolina by stimulating 
commerce and the shipment of freight through the Port of Charleston. In 
2004, Central America represented $359 million of the total value of 
the Port's business. In fact, Charleston's exports to Central America 
have grown faster than the average export growth. Most exporters agree: 
CAFTA is a great deal for South Carolina business.
  Yet there is a small group in the textile industry whose opposition 
poses a threat to this step forward. They say CAFTA will allow China to 
exploit a ``loophole'' in the agreement. But they fail to recognize 
that without CAFTA there will be no loop at all--just one giant hole 
that China will use to destroy our industry. The truth is that a vote 
against CAFTA is a vote for China. Garment factories in Central America 
purchase large amounts of American fabric and yarn. In fact, the region 
is the second-largest world market for U.S. textile fabrics and yarns. 
Under CAFTA, these garments made in the region will be duty-free and 
quota-free only if they use U.S. fabric and yarn. In fact, more than 90 
percent of all apparel made in the region will be sewn from fabric and 
yarn made in the United States, thereby supporting U.S. textile exports 
and U.S. textile jobs. This is especially important for South Carolina 
workers. In 2004, South Carolina's exports of fabric mill products to 
the CAFTA region were valued at $180 million, more than half of the 
State's total exports to the region.
  If we going to continue to have these exports and not lose the 
business to Asia, we must pass CAFTA. The American Apparel and Footwear 
Association made this point in a recent letter to President Bush where 
it said, if CAFTA ``is not enacted soon, U.S. apparel and footwear 
companies will place more of their business outside this hemisphere.'' 
And the National Council of Textile Organizations recently endorsed 
CAFTA, saying, Central America ``is a very important part of the 
domestic industry's supply chain and we need (CAFTA) to ensure that the 
U.S. textile industry can remain competitive against China.''
  The elimination of quotas on Chinese textiles has eroded the 
partnership the U.S. has with the Central American region. Our existing 
partnership is also weakened by burdensome documentation requirements 
and by the fact that it will expire soon. All of these factors reduce 
the incentive to make cloth
ing in the region using U.S. inputs. CAFTA, however, will solidify and 
stabilize this partnership by making the current program broader, 
easier to use, more flexible, permanent, and reciprocal. The agreement 
will create new sales opportunities for U.S. textile and apparel 
products by providing permanent incentives for the use of U.S. yarns 
and fabrics in textile articles made in the region. And it will also 
give us new advantages over our competitors by promoting duty-free 
access for U.S. textile and apparel exports to local markets in the 
region.
  I also thank the President and his administration for their efforts 
to make the agreement even stronger. Specifically, I have worked 
closely with U.S. Trade Ambassador Rob Portman to strengthen provisions 
dealing with textile pocketing. On May 9 of this year, Ambassador 
Portman wrote me about his desire to use the agreement's amendment 
mechanism to include pocketing in the rule of origin. He wrote:

       I assure you that USTR will utilize this mechanism, working 
     closely with our textile industry, to seek an amendment to 
     the CAFTA so that pocketing would have to originate in one of 
     the signatory Parties.

This is very important to textile manufacturers in South Carolina who 
make pockets and want to have a strong partnership with the CAFTA 
region.
  It is time to stop saying ``no'' to every trade agreement, regardless 
of the benefits. We must stop acting like we are operating in the 
business environment of 50 years ago. We must stand up and fight for a 
better deal today. We can't build a wall around our country and expect 
to remain competitive. And we can't keep sticking our heads in the 
sand. Instead, we must fight back with new agreements that knock down 
barriers and create new markets. We must fight back and win because 
that is what Americans do. We have the best workers in the world and we 
can compete with anyone in the world.
  CAFTA also provides a unique opportunity to promote democracy, 
security, and prosperity in a part of the world that was once 
characterized by oppression and military dictatorship. This agreement 
is critical to the economic and political stability of these young 
democracies, and it is a signal of our Nation's commitment to democracy 
and prosperity in this hemisphere. As we continue to fight the war on 
terrorism, America has a vested interest in making sure these countries 
do not turn their backs on freedom.
  I had the opportunity to personally meet with the Presidents from the 
CAFTA countries earlier this year, and many of them are taking 
significant political risks to promote economic freedom. We need to 
stand with them. We must stand with them and pass this agreement. The 
benefits of CAFTA are clear. The agreement will strengthen our economic 
ties with our democratic neighbors, it will promote opportunity and 
prosperity in the United States and the region, and it will strengthen 
our security at home by promoting democracy and prosperity in our 
hemisphere. This agreement is a forward strategy for freedom, and I 
encourage my colleagues to support it.
  Mr. President, again, I thank you for this time this morning. I do 
stand to speak on behalf of CAFTA, and I appreciate the Senator on the 
other side of the aisle yielding this morning.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. DORGAN. Mr. President, I yield myself such time as I use.
  The PRESIDING OFFICER. The Senator is recognized.
  Mr. DORGAN. Mr. President, if ever there was a triumph of hope over 
experience, it is bringing this bill to the floor of this Senate: a new 
trade agreement with the background of failed trade agreement after 
failed trade agreement, lost jobs after lost jobs, higher deficits 
every year, believing this new chapter of the same failed book of trade 
strategy will produce a different result. It is unbelievable to me.
  But before I begin, let me ask a question. There is a substantial 
lack of opportunity to ask questions on the floor because very few will 
attend this debate. But I was wondering whether in this trade agreement 
there is anything that has to do with exotic dancers or strip clubs. I 
wonder if anyone could respond to that.

[[Page 15016]]

  Let me tell you the reason I ask the question----
  The PRESIDING OFFICER. The Senator should be aware that Senators are 
not permitted to ask other Senators questions unless they have been 
yielded time on the floor.
  Mr. DORGAN. Let me say to the Presiding Officer, it is a fair point. 
I have not directed questions to other Members of the Senate. I ask a 
rhetorical question, and perhaps the Presiding Officer, in his capacity 
as a Senator from New Hampshire, would respond. But I ask the question, 
is there anything in this trade agreement that deals with exotic 
dancers or strip clubs? And if any of my colleagues would like to come 
to the floor to respond to that today, I would be glad to hear it.
  Let me tell you why I ask the question. We debated something called 
NAFTA on the floor of the Senate some years ago. It did not turn out 
very well--huge trade deficits, American jobs rushing off to Mexico. It 
did not turn out well at all. But now I discovered, going to the 
computer last night, using a Google search, that NAFTA had something in 
it about ``special skills.'' Let me read this to you. This is from my 
Google search last evening on the computer: ``Claiming a shortage of 
homegrown talent, strip clubs in Canada have used NAFTA to find new 
recruits in Mexico.''
  I thought, well, that is interesting. NAFTA had something that allows 
strip clubs in Canada to search for dancers from Mexico? Well, I found 
out what that was with a little further Google search: Employment 
authorizations based on NAFTA agreements were available for 
professionals, company transferees, traders, investors, and people with 
special knowledge: exotic dancers, et cetera--apparently, under this 
``special skills'' category. Quite remarkable, isn't it?
  Did anybody know that existed in NAFTA before it was voted on? Does 
anybody want to claim credit, I ask rhetorically? Does anybody want to 
claim credit for a provision in NAFTA that allows Canadian strip clubs 
to recruit exotic dancers from Mexico? Oh, probably not. Probably no 
one wants to claim credit for that today. But, apparently, that 
opportunity existed in NAFTA. It sure did.
  Is there anything in this trade agreement we ought to know about? Is 
there anything in this trade agreement that will probably persuade me 
to come to the floor of the Senate 5 years from now, 2 years from now, 
and say: Did you know about this? We probably will not learn that 
today, either. Let me tell you what we should learn today. Here, as 
shown on this chart, are our trade deficits. These are our trade 
deficits--year after year after year. I have always wondered what 
``reeducation'' means as a term--``reeducation.'' It is quite clear to 
me there is no reeducation anywhere near this 50 or 60 square miles of 
ground because we are about, today, in the Senate to pass another trade 
agreement which is exactly the same kind of trade agreement that has 
caused a massive trade deficit year after year after year, a gathering 
trade debt that is dangerous to this country.
  On these red lines on this chart there are no names. But I can give 
you some names. And I will today. These are the people who lost their 
jobs, the people who came home one night after work and said: ``Honey, 
I have been fired. I worked at my plant for 19 years. I was a good 
worker. I loved my job. But I got fired today. Do you know why? Oh, 
they are going to still make the products I made, but they are going to 
make them in China. They shipped my job to China because they found 
somebody who can do it for 30 cents an hour.''
  Every one of these lines has tens of thousands--hundreds of 
thousands--of names of American workers who have lost their jobs.
  And so in the first 4 months of this year, our trade debt is up 
another 20 percent. Last year it was a record. It is up another 20, 22 
percent. We are headed in exactly the wrong direction.
  What is the response of this Congress? What is the response of the 
President? Well, let's do some more of what we have been doing. This is 
the law of holes: Create a hole and just keep digging, according to 
these people.
  Let me make a couple of other opening observations. This bill should 
not be on the floor of the Senate. It does not comport with the 
Constitution of the United States. I think everyone in this Chamber 
knows that. This is a tariff bill. My colleague from Iowa described in 
great detail the tariff provisions in the bill. This is a tariff bill. 
A tariff bill, by the U.S. Constitution, cannot originate here. It 
cannot. It must originate in the House of Representatives.
  This bill is improperly on the floor of the Senate and I may today 
make a constitutional point of order. Every Senator knows it is not 
here in accordance with the Constitution, and yet we all put on our 
dark suits and come to the Chamber and vent for hours, acting as if 
nothing has changed, nothing is wrong, we have not read the 
Constitution. Tariff bills must originate in the House, not in the 
Senate.
  So we will pass this today, I am told. I am told the votes exist to 
pass this failed trade agreement. And then what will happen is the 
House will take it up, take up their version of it, and at some point 
it will be sent over here to be exchanged for the version we have 
already completed in the Senate. The problem is, I would say to the 
leaders, then there will be another 20 hours under fast track, 20 hours 
of debate to which we are entitled. Perhaps this will not work out so 
well after all.
  I find it interesting. I must say to the majority leader, I apologize 
for being irritated last night, but that irritation hasn't abated this 
morning. I knew what was going to happen with CAFTA. It was negotiated 
over a year ago. It was signed over a year ago and has never been 
brought to this Chamber. Why? Because they don't know if they have the 
votes in the House. So over a year it languished. I knew at some point 
they were going to try to fold it up into a tight, little package and 
sort of stick it through the keyhole before some kind of congressional 
recess. Sure enough, that is exactly what they have done. Lord knows, 
you don't want to have a long debate on the floor of the Senate about 
trade strategy.
  Having, for example, a debate of 3, 4, 5 days on one of the most 
significant problems we face is not something the majority party wants, 
not something the President wants. Do an agreement. Sign it up. Wait 
for a year. Buy off the votes with roads, bridges and dams and perhaps 
some refrigerators. I don't mean ``buy up'' votes; I mean persuade 
people by saying we will support your project--that was not a sensitive 
thing to say--persuade people who would have voted against you to 
decide they will vote for you, if you can get 3 or 4 miles of road 
somewhere near the hometown. You get enough votes, and then, a year 
later, fit this into this little crevice before the July recess. Then 
all the dust settles over the Fourth of July recess, and we come back 
and act as if there are no trade issues.
  So here we are. Some of my colleagues will speak about an issue that 
I care a lot about as well--sugar. This is the first step in the 
direction of deciding to take the sugar program apart and to devastate, 
particularly in our region of the country, the beet growers--beet 
growers in the Red River Valley of North Dakota--because they can't 
compete with this kind of dump-price sugar that comes from these 
regions. This agreement, in itself, will not ruin the sugar industry, 
but it is going to hurt it. It is the first step in a direction, a 
strategy, that will ruin the industry in which a lot of beet growers 
out there, working on the farm, who got up this morning hoping they 
could continue to make a living, are going to be mighty concerned about 
where this heads. The next agreement that will come after this is the 
Free Trade Area of the Americas with Brazil and others. It is an 
ominous direction and is a disservice to the one farm program that does 
work in this country.
  I would like to read a couple things. Most of you probably know Puff 
Daddy. Actually, Sean Combs is his name. He changed his name to P. 
Diddy. I never understood why somebody named Puff Daddy would change 
their name to P. Diddy. He is an artist, a musician. He

[[Page 15017]]

also makes clothing, or at least he has someone make clothing with his 
name in the label.
  So I held a hearing one day. We had workers, from Honduras, working 
in a plant in Honduras. Their job was to sew the sleeves on the shirts 
that were the Sean John label rather than Puff Daddy or P. Diddy. It 
seems to me--I am not in the shirt business--that Puff Daddy or P. 
Diddy might have been a better label, but they chose Sean John. So they 
contracted out for shirts to be produced in a plant in Honduras.
  I have been there. I have watched. I have been to Honduras. I have 
watched people make cigars and various things. We had three employees 
of the plant in Honduras that makes these shirts come and testify. I 
invited Sean Combs to come and testify. He chose not to. Let me 
describe what was said at this hearing. It is directly related to 
signing up to a trade agreement with these kind of economies and the 
allegation that will be made by my colleagues that there are no labor 
standards that are enforceable or are enforced in these countries.
  Let me read this. This was from Lydda Eli Gonzalez. In her report to 
us, she talks about her job. She says:

       I get up at 5 a.m.--

She is a young woman--

     to go to work at 6:45. I take two buses. When I get to the 
     factory, I have a tortilla with beans. I buy the cheapest 
     lunch I can, just a small piece of chicken, rice, beans and 
     water.

  And she describes the cost of that. And then she describes her day at 
the factory:

       My job is attaching sleeves to the shirt. There are 
     different styles of Sean Jean shirts, but for long-sleeved 
     shirts, a production line of 20 workers has to sew 190 dozen 
     shirts a day--that's 2,280 shirts. Management demands we 
     reach this goal, but it is impossible.

  And she goes on:

       They call us filthy names--you can't answer--like 
     ``bitch,'' ``Maldito,'' ``donkey.'' You can't answer the 
     supervisors or they will fire you. It is very hot in the 
     factory. You are sweating all day. There is a lot of dust in 
     the air. I breathe it in. You go into the factory with black 
     hair. You come out with hair that is white or red or whatever 
     the color of the shirts we are working on. It is forbidden to 
     talk. You have to ask permission to use the bathroom. We have 
     to get a pass from the supervisor and give it to the guard in 
     front of the bathroom who also searches us before we go in. 
     You can go once in the morning and once in the afternoon. 
     Also they watch the time, and if you are gone more than three 
     or four minutes, they call you on the loudspeaker. Another 
     thing, the bathrooms are very dirty. There is almost never 
     any toilet paper or soap. They don't permit us to get up to 
     get water. If the worker next to you goes, you try to take 
     some advantage and see if they can bring just a bit of water 
     to you. You have to focus, work as fast as you can, to 
     complete the production goals, always under pressure.

  She talks about being fired. She was one of 20 workers who were 
fired. All the new employees are required to take a pregnancy test. If 
it comes out positive, they are fired. ``Older workers suffer 
harassment and discrimination because the management prefers workers 
between 17 and 25 years old. When a woman gets to be 30, she can't work 
in these factories. And if she can get to work and if she is working, 
often she is harassed and sent to worse positions to try to make her 
quit.''
  She says:

       They search us physically when we enter the plant. If one 
     of us has candy, gum or lipstick, they take it away because 
     they think it could stain the clothing. They search them in 
     the bathroom.

  The point is this, this young woman, with 20 others, decided they 
really needed to try to organize to see if they could improve their 
lot. And 15 of them began to organize, and they were fired. You can't 
organize. Workers can't get together to try to organize to negotiate 
with management. They are fired--out of luck, out of a job.
  These countries say to us: We have labor standards. Sure they do. 
They have labor standards on the books, totally unenforced. This is 
what we are signing up to.
  This was Sean Combs. You remember the stories about Kathy Gifford and 
others. Sean Combs, I believe, to his credit, said he did not know this 
contracted labor was occurring, and I believe that he quickly took 
action to deal with that and moved this kind of production away from 
that plant.
  But let me ask the question: Does anybody think this is the 
competition for American workers that we ought to sign up for? 
Shouldn't we be doing trade agreements with countries that have labor 
standards? Shouldn't we decide, on behalf of American workers, that we 
care first and foremost about American workers and, second, we also 
care about the workers in the country with whom we are going to do a 
trade agreement? What does it say about us, about our value system, to 
suggest it doesn't matter?
  This is about money. This isn't about workers. It is about companies 
being able to access cheap labor, working under any labor conditions, 
in order to boost and fatten profits.
  I am well aware that there are those who take a look at those of us 
who don't support these trade agreements and they say: You are just a 
bunch of xenophobic isolationist stooges. You don't understand it. You 
probably don't have the capacity to understand it. We are describing a 
new world order. It is a global economy. Don't you get it?
  I wonder when things changed in this country to decide that we should 
not stand up for our economic interests. When did that happen? When did 
it happen that it was OK to decide those who stood up for America's 
economic interests--that is, for the demand that when we have a trade 
agreement, there would be fair labor standards, fair standards with 
respect to the environment, that we want to keep jobs in America--when 
did it become fashionable to say: You're a protectionist. You don't get 
it. You are sort of an economic nationalist. You are one of these 
America-first types. Shame on you.
  It seems to me the first goal of every trade agreement should be to 
recognize, from our standpoint, that we are interested in standing up 
for our economic interests, for our jobs. But that is not the case.
  I would like anybody to explain to me these dramatic and deepening 
trade deficits--which Warren Buffett, not necessarily a shrinking 
violet, says is heading us toward becoming sharecroppers, and that is 
exactly the case--I would like anybody to explain to me how, with this 
background, the decision is made that we ought to do more of it. We are 
told over and over and over again what we are doing with this next 
trade agreement is we are opening foreign markets for American 
products. That is absolutely nonsense. Give us a break. We have been 
through this.
  Later today, I will talk specifically about China because we did a 
bilateral on China. We have had a lot of trade relationships with 
China. The fact is, what we are doing with these trade agreements is 
not opening foreign markets, to any great degree, to American goods. I 
would love to take my time--and I have 5 hours allotted to me--to go 
through a debate. Others probably have different views. They believe it 
is fine, for example, for the country of Korea to ship us 680,000 cars 
a year on boats that land on the shores of the United States so 
American consumers can buy Korean cars. And then we only get 3,800 cars 
from the United States into Korea. That is fine, some people might 
think. I would love to debate that. Perhaps we have somebody who wants 
to stand up later today during my time and have a real discussion about 
that. I would be happy to do that. I don't need three people. I would 
just like one person to say: ``Boy, I like the way this is going. This 
sure looks good for America. And I sure like what is going to happen 
with China and bilateral automobile trade, and I sure like what 
happened in the bilateral with China by which we are allowed to charge 
a tariff that is one-tenth the tariff charged by the Chinese in 
bilateral automobile trade or I sure like the notion of what happened 
post-NAFTA.''
  Let me do this for a moment. I think it is important for people to 
understand. We passed NAFTA, the North American Free Trade Agreement. 
When we did, we had a very slight trade surplus with Mexico and a 
modest deficit with Canada. We very quickly turned a slight trade 
surplus with Mexico into a very large deficit, and we turned a modest 
deficit with Canada into a very large deficit.

[[Page 15018]]

  The promises for NAFTA were grand promises about massive new numbers 
of American jobs and so on. None of that was accurate. There were those 
who stood on this floor and said, with respect to NAFTA: What that 
means is, we are going to get the product of unskilled labor coming in 
from Mexico. That is what that means. And so what are the three biggest 
imports from Mexico now? Automobiles, automobile parts, and 
electronics--all the product of high-skilled labor. They were all 
wrong. No one, of course, will stand on the floor and say: I admit 
that. But they have all been wrong. All we have seen is an exodus of 
American jobs. This chart is a certification to the U.S. Government of 
companies laying off U.S. workers due to NAFTA. We know that because 
they are required to certify to the Department of Labor in order for 
their workers to be available for trade adjustment assistance. Trade 
adjustment assistance is a melodic, soft-tone that says: When you fire 
your workers because of a trade agreement, you are able to get the 
Federal Government to pay your workers a little something. It is like 
extra unemployment.
  So we know these companies have said: Because of NAFTA, we are laying 
off workers. We want them to be eligible for trade adjustment 
assistance.
  Let's go down the list a bit. Fruit of the Loom. I can see the title 
on the book: ``When America Lost its Shorts.'' I remember the day that 
Fruit of the Loom announced that it was going to move its production 
out of this country. It was headline news, going to get rid of all the 
workers. Doesn't mean they are not going to make shirts and shorts any 
more. They are going to make them elsewhere, Mexico and China.
  Levis, 15,676 workers making Levis. There is not much more all-
American than Levis.
  What a great American brand, Levi. Everybody likes them. I wear 
Levis. Levis are gone. There is not one pair made in the United 
States--not one. And, furthermore, the company that made Levis has 
certified to the Federal Government that due to NAFTA, 15,676 employees 
should be eligible for trade adjustment assistance. I will say that in 
English. It means that because we passed the NAFTA trade agreement, 
this company decided to get rid of 15,676 workers, and they want, under 
trade adjustment assistance, to be eligible to get extra money from the 
Federal Government.
  Is there anybody in the Senate who knows the name of a worker that 
made Levis and lost their job? I am guessing not. I am guessing that 
almost every one of these 15,676 people were like every other worker in 
this country--proud to get up in the morning, put on some clothes, go 
to work, and feel as though they had a sense of self worth to provide 
for their family and to do a job. Some probably worked 25, 30 years for 
that company and did the best they could. And they had to come home and 
say to their spouse: ``Honey, I have lost my job. It doesn't mean they 
are not going to make Levis anymore. They are just going to make them 
in Mexico or China or Indonesia or Sri Lanka or Bangladesh--you name 
it. They say I make too much money.''
  I have told this story repeatedly, and I will do it again even if it 
bores people. Huffy bicycles is the classic one. It is the easiest to 
understand. I believe Huffy has about 20 percent of the American 
marketplace. You buy them at Wal-Mart, Sears, and K-Mart. Huffy 
bicycles used to be made in Ohio in this country by workers who, by one 
account, made $11 an hour plus benefits. Huffy wrote to me and said it 
was more than that. So whatever it is--it could have been $15 or $18 an 
hour plus benefits--they made a good bicycle. They had a decal of the 
American flag on the front of them. They fired the workers who made 
Huffy bicycles. Those workers are gone. In fact, the last job they 
performed was to take the American flag decal from the bicycle and 
replace it with a decal of the globe. All Huffys are now made in China 
by people who work for 30 cents an hour, 7 days a week, 12 to 14 hours 
a day. The folks in Ohio are told they cannot compete with that. I can 
understand why. Should you be expected to compete with people who make 
30 cents an hour?
  So American workers lose their jobs. Do you think some people from 
Huffy Bicycle, who were proud to make them for many years, and came 
home to tell their families: ``I lost my job because they found 
somebody in another part of the world--halfway around the world--who 
will work 7 days a week, 12 hours a day, and they can pay them 30 cents 
an hour--and they can hire kids, by the way.'' Does anybody in this 
Chamber know the names of these people who worked for Levi's or Huffy 
Bicycle or Fig Newton Cookies? Does anybody know the names of the 
people who worked for the company called Radio Flyer, which makes 
little red wagons? They are gone from America.
  I can stand here for an hour and talk about those kinds of issues. On 
this chart are the 100 largest companies certifying to the Department 
of Labor jobs lost due to these trade agreements. Let me tell you 
something else. You cannot get these numbers anymore. They are not 
available. Do you know why? The Department of Labor won't make them 
available. This chart says ``The Labor Department withheld trade 
reports.'' Let me quote from this article: ``The Labor Department has 
kept secret for more than a year, studies that supported Democratic 
opponents of the Bush administration's new Central American trade 
deal.''
  There was a report paid for by public funds that documented the 
working conditions in CAFTA and the Central American countries of the 
type I just described, and, of course, that document was covered up, 
kept secret. The official Government document from the Department of 
Labor that would have provided numbers of how many jobs were lost, as a 
result of certifications by companies that were going to get rid of 
their workers--this information doesn't exist anymore either.
  I have called the Secretary of Labor and said: You are collecting 
this data and you are choosing now not to make it public. Why? She 
says: I will look into it.
  I placed a second call yesterday, but I have not heard back. In fact, 
you cannot get this information anymore. If there is bad news, cover it 
up, I guess. Don't let bad news out.
  Madam President, let me just read for a moment from something written 
by someone I deeply admire. I like Warren Buffet a lot. I don't know 
him well, but I consider him a friend. I have met him a good number of 
times. He is the second richest man in our country, or probably in the 
world. He is remarkably successful. He doesn't walk the talk or sound 
like somebody with billions and billions of dollars. He is just a 
wonderful, remarkable guy with a great spirit. He wrote a piece to the 
shareholders of his company, Berkshire-Hathaway, that was very 
interesting to me. I called Warren about his speech. He said this about 
the trade deficit, the current account deficit:

       Large and persistent current account deficits produce an 
     entirely different result. As time passes and as claims 
     against us grow, we own less and less of what we produce.

  He means that we have a trade deficit of almost $2 billion every day, 
7 days a week, and it means foreign governments or foreigners have 
assets in the form of American dollars, American stock, and are buying 
American real estate. That is why you saw that China wants to buy a big 
oil company. They have the money to do it.
  With respect to the trade deficit we have with China or the trade 
surplus they have with us, he says:

       Should we continue to run current account deficits 
     comparable to those now prevailing, the net ownership of the 
     United States by other countries and their citizens a decade 
     from now will amount to roughly $11 trillion. And if foreign 
     investors were to earn only 5 percent on that net holding, we 
     would need to send a net of one-half billion dollars in goods 
     and services abroad every year just to service the U.S. 
     investments then held by foreigners.
       A country that is now aspiring to be an ownership society 
     will not find happiness in a sharecropper society. Yet, that 
     is precisely where our trade policies, supported by Democrats 
     and Republicans alike, are taking us.

  Perhaps there are some in this Chamber who think this is not the 
case, that these trade policies are just wonderful,

[[Page 15019]]

that this red ink is just another innocent color, that these trade 
agreements have really worked well for America. That is probably 
because nobody in this Chamber has ever lost their job to a bad trade 
agreement. No journalist has either, for that matter.
  We have an interesting situation in this country. We have now, for 
about the last 30 years, seen a dramatic change in the economies of our 
country and others. It is described as a global economy. It has 
galloped forward in a very aggressive way, but the rules have not kept 
pace. So the largest international corporations--many of them 
American--have defined the new economy in their own image. They want to 
produce where it is cheap and sell into our marketplace. They want to 
be able to produce, for example, in China and Indonesia and Bangladesh 
and Sri Lanka and be able to sell that product to Des Moines, IA; 
Fargo, ND; Denver; Chicago; or Los Angeles. That is quite a strategy 
about fattening profits: Produce where it is cheap, where you can hire 
kids, where you can build a factory and not worry about having a safe 
workplace, where you can dump chemicals into the air and water, and 
especially where you can decide if your workers want to form a union, 
you can fire them just like that. If you produce there, you can produce 
for pennies, take that product and sell it into the established 
marketplace in the United States, and you can fatten your profits. 
Pretty good deal--if you are one of the companies who wants to do it.
  But the rules for this globalized economy have not kept pace at all. 
There have been virtually no rules. Everyone in this Chamber knows that 
we have signed up to trade agreements with countries that say to 
companies: You can fire your workers if they try to unionize. Now, that 
is not a comparative advantage--going back to Ricardo. Ricardo 
described the doctrine of comparative advantage, which says it is 
easier to raise sheep and produce wool in England and easier to grow 
grapes and produce wine in Portugal; so each should do what is in its 
own best interest and what it does best and then trade. So you raise 
sheep, you share the sheep, get the wool in England, grow the grapes 
and stomp the grapes and produce wine in Portugal, and the English 
trade their wool to Portugal, and the Portuguese send wine to the 
English. That is the doctrine of comparative advantage--doing what is 
most beneficial and efficient for each. There is no doctrine of 
comparative advantage when you have a country deciding they are going 
to have 30-cent labor because we will fire people who try to unionize 
because we will not enforce restrictions with respect to the 
requirement that you have safe workplaces. We will have cheap labor 
because we will let you hire 12-year-old kids, work them 12 hours a 
day, and pay 12 cents an hour, and we will turn the other way. That is 
a political advantage. That is a decision by a government to continue 
to repress its workers.
  Our trade agreements, historically, rather than lifting others up, 
which we ought to do in trade agreements, have had the effect of 
pushing American workers down. That can work for a while, but it cannot 
work for a long while because, ultimately, the question is going to be 
this: Who is going to buy those products made with 30-cent labor in 
China? Will it be the people who lost their jobs in the United States? 
Will it perhaps be one of these hundreds of thousands of people, each 
just a number, but each represented by a family? Will they buy those 
products when they are out of a job? You may say unemployment is not so 
high here and many of these people have been rehired. Yes, many have--
at lower wages. That is the way this global economy has been working.
  In my judgment, this does not work for our country. It is just not 
working. My colleague from Iowa made the point--a fair point--should we 
not want to lower tariffs in other countries? Absolutely. Can I remind 
my colleagues, and others, that we are so ham-handed and fundamentally 
incompetent in negotiating trade agreements, using beef as an example--
let's go back for a moment prior to the discovery of a Canadian cow 
that had mad cow disease in the United States. Prior to that time, we 
were 15 years away from a beef agreement we made with Japan in the late 
1980s. Fifteen years later, after a beef agreement with Japan, a 
country with whom we have had a very large deficit always--and still 
do--there was a 50-percent tariff on every pound of American beef going 
into Japan. What a miserable failure that is. It happens to us in 
virtually every circumstance.
  I will mention one additional thing. Our trade negotiators do such a 
terrible job on behalf of this country. I assume they do it on behalf 
of whoever sends them out with instructions. Let me ask, if during the 
discussion today--and we will be here for some hours--I would like one 
Senator--if we can find somebody who knows the answer to this--to tell 
me, in the bilateral trade agreement with China, a country with whom we 
have a giant trade deficit, an alarming and dangerous trade deficit, 
how it is justified that China shall impose a 25-percent tariff on any 
U.S. automobiles we sell in China, and we will impose a 2.5-percent 
tariff on Chinese automobiles sold in the United States?
  How is it that we have a bilateral agreement that imposes a tariff 10 
times higher on U.S. cars that we sell in China than Chinese cars sold 
in the United States? I want one person--I have asked this question for 
years--I want one person to tell me how that happened because the 
Chinese are now gearing up an automobile export industry. In fact, 
General Motors has gone to court to sue the Chinese because they say 
the Chinese have stolen the entire production line blueprints for a car 
called the QQ. General Motors said they stole the production line 
blueprints of a General Motors car. This company is called Chery, C-H-
E-R-Y, which is interesting; it is one letter away from Chevy, C-H-E-V-
Y. This Chinese company called Chery is producing a QQ car that General 
Motors says is the stolen production line blueprints of a car they 
have. They are doing that, and all the press says they are gearing up 
for a substantial Chinese automobile export market.
  Guess what. When they do that, they will find a very friendly tariff 
in our country that is one-tenth the tariff that now exists in China by 
virtue of acceptance of a trade agreement we have with China. It is 
unbelievable to me, the incompetence of having that sort of thing 
happen.
  I will not go on at length. We do not make any automobiles in North 
Dakota, so I am not representing the automobile manufacturers. I am 
just telling my colleagues that it does not matter whether it is 
automobiles or textiles or farm products.
  My colleague from Iowa cares a lot, I am sure, about agricultural 
products. We work together on a lot of agricultural issues. I know he 
cares a lot about family farmers. Interestingly enough, when we did the 
bilateral agreement with China, we had a provision in that agreement 
about the number of million metric tons of wheat that China would be 
expected to allow in duty free. Right after that was done, of course, 
the Chinese Agriculture Minister went down to the southern part of 
China and said to the South Asia Post: ``That doesn't mean anything; 
that doesn't mean we are actually going to import that wheat from 
America. That is just something in writing.'' Indeed, they have not. 
When will we understand that promises not kept are not promises at all?
  I suppose you can make a case to hook up in a trade agreement with 
almost any region in the world. Somebody said to me: How on Earth can 
you suggest these small countries would threaten our country? I am not 
suggesting that. I am just saying when you are doing something wrong, 
stop doing it, change it, and do it right. That is not rocket science.
  This trade agreement, with its pathetic provisions dealing with labor 
and its pathetic provisions protecting the environment, is exactly the 
same as all the other trade agreements. You can say the environmental 
provisions do not matter. Don't they really? We inhabit this Earth. 
There are 6 billion of us. We have 6 billion neighbors on

[[Page 15020]]

this little planet called Earth. We circle the Sun. Somehow we end up 
here in the United States--just in this place--and there is no place 
like it on the face of the Earth. We are living in a fishbowl. We can 
clean up our part of the fishbowl, but if somebody on the other side is 
pumping in sludge, we are all breathing it. So environmental standards 
and labor standards matter a lot.
  This trade agreement is exactly like the others. It hooks up the 
countries--and I already read the description-- that do not enforce 
their standards at all. Second, it decides we will have another 
loophole by which you can transship goods through these countries into 
the United States.
  One of my colleagues said to me: So what, it is coming in anyway from 
China. So what? The fact is, if anybody in this Chamber were one of 
these statistics--and there are about 200,000 of them on this sheet--if 
anyone in this Chamber were one of these statistics, nobody would say 
``so what.''
  ``So what'' is we are losing jobs in this country. There is no social 
program we work on in this Chamber that is as important as a good job 
that pays well and allows people to take care of their families. There 
is no social program as good as that. I am telling you, in case after 
case, we are seeing good jobs leaving our country because others will 
do them for less under conditions we would never accept in this 
country.
  I have said many times that we had people die in the streets of this 
country fighting to organize as workers. People were literally killed 
in the streets of America for that purpose. We had people who went to 
the streets for America demanding the opportunity to work in a safe 
workplace. We have been through this for a century, describing the 
conditions of production in this country that were fair. And in a 
moment, some companies can pole-vault over all those impediments and 
say: I don't like them, never liked them; they represent regulations, 
they represent things we don't support, and we are going to move our 
jobs to China; and by the way, when we get there, we don't have to 
worry about unions, we can fire them if they try to unionize, and if we 
don't fire them, the Chinese Government will take care of them.
  What is happening is wrong. I am not saying we should build walls 
around our country. I am not saying we should retreat from the global 
economy. I am saying we ought to recognize there has to be a set of 
fair rules to represent this country's economic interest. If we do not 
have that set of fair rules, then we cannot possibly succeed.
  Some say the Americans can compete anywhere, we can win anywhere. We 
can compete if the rules are fair. But post-Second World War, in the 
last 50 years, some very shrewd economic competitors have developed in 
this world.
  These trade deficits I have shown describe a circumstance in which we 
cannot compete with one arm tied behind our back. We cannot compete if 
it is unfair. We cannot ask American families to decide if $10- or $15-
an-hour wages is something of which they should be ashamed because it 
is so much more than would be paid to workers hired in Bangladesh or 
China. We cannot do that to American workers without in the longer term 
dramatically changing the standard of living in this country.
  Others will say: You are talking about manufacturing. You should 
understand that we are going to create new jobs; we are creating new 
jobs. Take a look at what is happening with software engineers, with 
white-collar jobs. Pick up the New York Times from last week on IBM and 
then go to India and go to China and find out what kind of jobs are 
coming in addition to factory jobs. It is not just factory workers. It 
is white-collar jobs. It is engineers.
  Every young person in this country who is in earshot of this debate 
should understand their future is going to be affected by what we are 
doing. Their opportunity for good jobs will be affected by what we are 
doing.
  I, obviously, have additional comments and additional time in which 
to do it later today. We have colleagues who have been waiting. I 
apologize for taking as much time as I did. This is a very important 
issue. I regret very much that we are doing it this way, just sticking 
it in a little keyhole crack between now and when we get out of here 
for the July Fourth week. I knew this was going to happen. One year 
ago, this bill got done. We did not hear about it for a year. I knew 
one day we would find it stuck in a little keyhole, hoping we would not 
have a real debate about trade on the floor of the Senate.
  I guess now we are on autopilot. They are going to finish this maybe 
late tonight, and they have accomplished their purpose, but they have 
done America no service. It is no service to America to avoid facing 
straight in the eye a serious problem facing this country.
  Once again, to all those listening who call this protectionism, you 
are just wrong. This is not about protecting in the sense of being a 
protectionist and wanting to build walls around our country. It is 
about standing up for American interests. It is about trade agreements 
that should be mutually beneficial, not one-way trade agreements, and 
it is about finally suggesting that we be hardheaded and make trade 
agreements economic policies, not softheaded foreign policy down at the 
State Department.
  I could talk later about, for example, it is recommended we take 
action against China on this and that for trade, but the State 
Department says: You can't do that; that is all foreign policy. So our 
country walks around half hunched over worried about lost jobs and not 
willing to talk about it. And what do we do? We negotiate another trade 
agreement of the same type. Is anybody thinking? Let's hope through 
this debate perhaps we can begin to think through some of these issues 
and turn a corner.
  Let me also say it was probably impolitic of me at the start of this 
discussion to ask about exotic dancers in strip clubs. I will ask again 
just because it probably is impolitic if there is anything in this 
trade agreement about exotic dancers in strip clubs. The reason I ask 
is because in the NAFTA agreement that passed the Congress, according 
to what I have found doing a Google search, Canadian strip clubs have 
used NAFTA to find dancers from Mexico under the extended visas and 
employment applications in NAFTA--exotic dancers were part of the 
provision dealing with special skills. I am just guessing that there is 
no one in the Chamber of the Senate who voted on NAFTA who would have 
guessed it would have application to exotic dancers having special 
skills. Maybe I am wrong.
  I ask the question: Is there anything in this trade agreement that we 
should know about that perhaps I will come to the floor of the Senate 
and talk about several years from now, such as this?
  The point I am making is, most people do not understand what is in 
these trade agreements. They do not understand the circumstances and 
the consequences of the trade agreements. All we hear is just more 
tired-sounding platitudes about reducing tariffs.
  By the way, when we passed NAFTA, as my colleagues know, NAFTA 
reevaluated the peso, meaning it obliterated everything under NAFTA 
with respect to tariffs almost immediately.
  I will cover additional material at a later point today. I yield the 
floor.
  The PRESIDING OFFICER (Ms. Murkowski). Who yields time? The Senator 
from Iowa.
  Mr. GRASSLEY. Madam president, I yield such time as the Senator from 
Colorado may use.
  The PRESIDING OFFICER. The Senator from Colorado.
  Mr. ALLARD. Madam President, I thank the chairman of the Finance 
Committee for yielding. I compliment him on his tremendous leadership 
in the Finance Committee, particularly on the issue of trade.
  I rise today in strong support of the U.S. Central America and 
Dominican Republic Free Trade Agreement, known as CAFTA, and our 
administration's current trade policies.
  We sometimes forget what history has taught us. If we look back to 
the early part of the 20th century, the

[[Page 15021]]

early 1900s, our country was struggling economically. One of the 
reasons, it was decided after a while, is because we were too 
restrictive on our trade policies. We had high tariffs on a lot of 
different products coming into this country. All of a sudden, the 
economists began to wake up: If we liberalize our trade policies, we 
begin to open trade to the entire world, and we benefit. Lo and behold, 
we found our country began to do better economically.
  We forget what history taught us. We do not want to go back to some 
of the old tried-and-failed solutions some of my colleagues on the 
other side are talking about. They do not work. It destroys your 
economy.
  If we look with other countries to liberalize our trade agreements, 
we raise the entire tide. Sure, other countries benefit, but we benefit 
even more. We will see that as we move forward with this debate.
  NAFTA has not hurt this country, it has helped it. It has created 
more jobs, not less. So many figures we will hear presented here are 
focused on one particular group, it is one side of the ledger. Nobody 
talks about what has happened on the other side of the ledger when we 
created more jobs, particularly on the service side of our economy.
  Another point I would make is look at the poor countries in the world 
today. They have more trade restrictions than those more modern 
countries that are doing well economically. Doesn't that tell us 
something? Doesn't that tell us that if we can get them to relax their 
tariffs, they can begin to benefit with us and what is happening in the 
growth of our economies? Not only do we help them, but we help 
ourselves. So it is a mutual win-win agreement on these international 
trade agreements.
  We can look at all these trade agreements and see how they have 
helped us economically. They have helped our friends and trading 
allies. They have helped us to export the idea of democracy and what 
free markets are all about. It is what makes a difference between our 
success and many other countries that do not have a democracy, that do 
not talk about how important it is to have free markets.
  I rise today in strong support of this trade agreement. Prior to the 
Bush administration, momentum of trade liberalization had clearly 
slowed. Thankfully, Congress reapproved executive authority for trade 
agreements, and with the leadership of President Bush, the 
administration has made international trade a high priority for the 
health and well-being of the American economy. That is good.
  We have acted to strengthen the President's ability to eliminate 
trade barriers with other countries. The first steps have been taken 
toward a new era of trade liberalization.
  At the end of 2002, the Bush administration completed free-trade 
negotiations with Chile and Singapore which were first begun by the 
Clinton administration in 2000. This is not a partisan issue, it is a 
bipartisan issue. These free-trade agreements with Chile and Singapore 
entered into force on January 1, 2004.
  In 2004, the agreements with Australia and Morocco were signed and 
approved by Congress, and this Australian trade agreement recently came 
into force this January.
  These agreements make a strong statement about the commitment of the 
United States to international trade, and CAFTA continues the trend of 
reaching bilateral trade agreements in our own hemisphere and abroad.
  The countries entering into CAFTA are among the developing countries 
that already enjoy duty-free access to U.S. markets for the majority of 
their exports. That is their goods coming into our country. While these 
developing countries have high tariff and nontariff barriers on U.S. 
exports and impose restrictions on U.S. businesses, the agreement will 
liberalize trade in goods, services, government procurement, 
intellectual property investment, and address important labor and 
environmental issues. We are going to let them join with us in our 
economic prosperity. That is not going to hurt the United States. It is 
going to benefit our economy.
  Trade between the United States and CAFTA countries totaled over $33 
billion alone last year. The United States exported almost $16 billion 
in goods to five Central American countries and the Dominican Republic 
in 2004--more than all exports to Russia, India, and Saudi Arabia 
combined.
  This agreement will create the second largest U.S. export market in 
Latin America--$16 billion--behind only Mexico, and the 14th largest 
U.S. export market in the world. The market access and trade discipline 
provided by CAFTA offer an opportunity to expand U.S. exports to a 
region that is already seeing high export growth rates. In fact, from 
2000 through 2004 export shipments to CAFTA designations grew by almost 
16 percent compared to 5 percent for U.S. overall exports.
  CAFTA also helps to move the current trading relationship from one-
way preferences to a more reciprocal partnership. Currently, about 80 
percent of the region's exports enter the United States duty free, 
while U.S. goods exported to CAFTA countries face significant tariffs. 
However, with this agreement in place CAFTA will boost opportunities 
for exporters throughout the country, providing new market access for 
these producers.
  Specific to my home State's interests, the State of Colorado, CAFTA 
immediately eliminates tariffs on 80 percent of U.S. exports and 
eliminates all tariffs within 10 years, including up to 15 percent 
tariffs on Colorado's exports of machinery, manufactured products, and 
transportation equipment. The information technology producers will 
also gain with the elimination of distribution barriers and elimination 
of information technology tariffs, as well as the opening of key 
information technology services, including telecommunications, and will 
also protect intellectual property rights.
  For Colorado's farmers and ranchers CAFTA will eliminate tariffs on 
50 percent of U.S. exports immediately and most remaining duties within 
15 years, benefiting beef and pork producers with the immediate 
elimination of tariffs over 15 years; dairy products with duty-free 
tariff rate quotas that will expand from over 10,000 tons in year 1 and 
out of quota tariffs eliminated over 20 years; and finally corn, wheat, 
and grain products with the immediate binding at zero of tariffs on 
wheat, barley, oats, and rye as well as for corn in Costa Rica and 
sorghum in the Dominican Republic and Guatemala. All remaining tariffs 
on feedgrains will be eliminated over 15 years.
  Clearly, this agreement greatly benefits my State of Colorado and the 
Nation as a whole. I am pleased to stand behind the agreement reached 
by former U.S. Trade Representative Robert Zoellick and our current 
USTR, Rob Portman.
  On noneconomic impact, I have already said that even if we were to 
set aside all the economic benefits for continuing liberalization of 
international trade like CAFTA, there are still many other reasons, 
most notably humanitarian reasons. History has shown it is the isolated 
closed societies that are the most brutal and repressed. International 
contact brought about by increased trade with businessmen, foreign 
goods exchanges, corporate presence, and marketing serves to increase 
access to a higher standard of living and a better quality of life.
  International trade also requires important reforms of the domestic, 
legal, and business environment that are key to encouraging business 
development and investment. Such reforms include providing greater 
transparency for Government to strengthen the rule of law and improving 
protection and enforcement of intellectual property rights. We must 
always remember that America's No. 1 export is democracy, and 
overreaction to our trade deficit, increasing tariffs, or other false 
barriers to trade will damage not only our bottom line but also our 
national security interests. We cannot allow that to happen.
  Madam President, we have heard a lot of doomsday predictions from 
opponents of this fair trade agreement that CAFTA will lead to all 
kinds of job loss both here and in Central America. A

[[Page 15022]]

lot of these people said the same thing about NAFTA. Remember the great 
sucking sound of jobs that were supposed to go to Mexico? Well, it just 
did not happen.
  Let's take a look at this chart. This is the chart on U.S. jobs from 
1993 to 2004. Remember that we adopted NAFTA in 1993, I guess 1994. 
What this chart shows is the number of jobs in the United States from 
1993 out to 2004, that if the trade critics were right, you would 
expect to see a fall in the number of jobs in the United States. 
Following the passage of NAFTA, look at it. It just did not happen. The 
blue line is manufacturing jobs--basically, a straight line, a little 
bit of reduction on the end. And look at what has happened, though, to 
nonmanufacturing jobs. This is the purple line or the light pink line, 
what is happening in the growth. We simply have not lost any jobs since 
the start of NAFTA. In fact, the United States had almost 17 million 
manufacturing jobs in 1994. That number rose to 17.26 million by 2000. 
Now it is falling only after the recession hit us in the year 2000. 
That was about the time we had 9/11. In fact, after NAFTA passed, the 
U.S. unemployment rate dropped.
  Take a look at the U.S. unemployment rate from 1993 to 1994. In 1993, 
the U.S. unemployment rate was about 6.9 percent as reflected here, and 
in 1994, the year NAFTA passed--right in here reflected by this chart--
it fell to 6.1 percent, and then it continued to fall reaching only 4 
percent in 2000. Then at its peak postrecession point, the unemployment 
rate was 5.5, still lower than it was in 1994, I might add. So NAFTA 
clearly did not cause massive unemployment in the United States as 
predicted by trade critics.
  Well, then the critics will say that maybe they were wrong with the 
numbers. Maybe there was no massive loss of jobs, but NAFTA caused us 
to substitute good-paying jobs for bad-paying jobs. Again, the facts 
show that they were wrong. Let's take a look at real hourly wages from 
1983 to 2004. What we see happening here is a drop in real hourly wages 
until we get down to 1994 when we then adopted NAFTA.
  Lo and behold, look what happens to wages, both the real average 
manufacturing wages, which is reflected by this top line, and then what 
has happened with the real hourly wages in the private sector. Look at 
the climb that we have seen in real hourly wages. Real hourly wages 
have risen since NAFTA for all workers. In fact, wages that were in 
decline in the decade prior to NAFTA have increased steadily since the 
NAFTA agreement was reached.
  We also heard that NAFTA would result in the flood of cheap imports 
from Mexico. Again, the critics were simply wrong. I point to this next 
chart which reflects U.S. imports from Mexico prior to NAFTA, and under 
NAFTA, as a share of total U.S. imports. U.S. imports from Mexico have 
held fairly steady at 7 percent, as we can look across here, as a 
percent of total U.S. imports, not much higher than they were in the 5 
years prior to NAFTA.
  We also heard that U.S. companies would start investing all their 
money in Mexico because U.S. workers can't compete with Mexico's wage 
rates. Again, the doom and gloom crowd was simply wrong. Look at the 
chart. What we see, talking about U.S. direct investments, is that U.S. 
investments didn't migrate to low-wage countries as predicted. In fact, 
after NAFTA went into effect, U.S. investment in Europe increased by 
48.5 percent of total U.S. investment abroad to 53.8 percent in 2003.
  Here is what happened with the investment in Mexico. If we look at 
the larger peaks that we have over here, this reflects what has 
happened with Europe. These are modern countries that we are dealing 
with, and we have the poorer countries down here. We did not see our 
investments being soaked up by low-wage countries. We still continue to 
maintain our trade with modern countries. So our challenge is to get 
poorer countries up into our modern sphere.
  In contrast, U.S. direct investment in Mexico accounted for 2.8 
percent in 1994 and just 3.4 percent 10 years later. Put another way, 
Europe's share of investment increased by 5.3 percentage points, and 
Mexico's by .6 percentage points.
  We also heard that Mexico was just too poor to buy our product so we 
should not trade with them. Wrong again. Mexican consumers increased 
their purchases of U.S. consumer goods since NAFTA went into effect. In 
fact, U.S. exports of consumer goods are 66 percent higher in 2004 than 
they were in 1993.
  U.S. exports of home entertainment equipment grew from $984 million 
to $1.293 billion. Exports of household goods have grown from $1.4 
billion to $2.1 billion. And U.S. agriculture has benefitted. Since the 
implementation of the agreement, U.S. agricultural exports to Mexico 
have nearly doubled. Mexico now imports nearly $6.5 billion of U.S. 
agricultural products, making them our third largest market.
  It is important for all of us to realize that we can take some of 
these figures, if we just talk about certain individual commodities or 
certain individual industries, and we can talk about just that 
particular--we can single out industries that for one reason or another 
have problems. The overall figures shown on these charts indicate what 
is happening with trade and what is happening with the economy as a 
result of liberalizing our trade and opening it up. I don't think 
anybody can deny that we have not benefitted. And I don't think that 
anybody can deny those countries that have traded with us have not 
benefitted. So we all benefit from this rising tide. That is why I feel 
so strongly that we need to move forward. I think the doomsday 
scenarios predicted by the critics did not happen. They were wrong 
about the North American Free Trade Agreement then and they are wrong 
about the Central American Free Trade Agreement now.
  Madam President, we need to move forward. I applaud the leadership 
for moving this issue forward quickly. I particularly applaud the 
chairman of the Finance Committee for his superb leadership on this 
particular issue. I know it is difficult and demanding, but it is 
important, important to the welfare of everyone in America, not just a 
few. It is important to the welfare of our trading partners, not just a 
few. This is an overall policy where many people benefit, and we should 
not forget that the whole economy of the United States will be better 
because we have liberalized our trade. What we saw in the early 1900s 
is a lesson we should not forget because we had high tariffs and trade 
restrictions that did not work. Now we are in a different era. We don't 
want to forget the lessons history taught us.
  Madam President, I want to yield the floor and thank the leadership 
and particularly Chairman Grassley on this issue.
  I ask unanimous consent to have two editorials printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

         [From the (Denver) Rocky Mountain News, May 14, 2005]

                          CAFTA Still Critical

       Six Latin American presidents made an unprecedented joint 
     trek to the Capitol this week in a last-ditch effort to drum 
     up support for the Central American Free Trade Agreement. But 
     the protectionist mood sweeping much of the nation appears to 
     have infected all too many of Washington's political elites.
       At risk is America's global economic leadership, which some 
     lawmakers seem all too willing to trade away for support from 
     Big Labor, environmental groups and especially the sugar 
     lobby. Because it is having trouble mustering the votes for 
     passage, the White House has in recent days taken to 
     reminding Congress that CAFTA is also necessary to help 
     secure democracy and development in a region wracked by civil 
     war, drugs, human trafficking and economic stagnation over 
     the past two decades.
       Interestingly enough, this same argument--that CAFTA is 
     good for our own national security--is being made by a conga 
     line of diplomats from both political parties, including 
     former Secretary of State Warren Christopher, former defense 
     secretaries William Cohen and William Perry, Bill Clinton's 
     special envoy to the Americas, Thomas McLarty, and Jimmy 
     Carter's trade representative Robert Strauss, to name but a 
     few.
       CAFTA would end duties on 80 percent of the $15 billion in 
     U.S. exports to the 44 million consumers of Costa Rica, 
     Honduras, El

[[Page 15023]]

     Salvador, Guatemala, Nicaragua, and the Dominican Republic in 
     the Caribbean. Currently, those countries levy average 
     tariffs ranging from 10 percent to 20 percent on a host of 
     U.S. goods such as motor vehicles, grain and meat, while the 
     U.S. rate is zero. The U.S. Chamber of Commerce predicts U.S. 
     sales to the region could expand by more than $3 billion in 
     the first year once CAFTA tariff limits take effect. The 
     American Farm Bureau estimates agriculture exports--about 
     $1.6 billion in 2003--would grow $1.5 billion a year. Winners 
     would include Colorado's feed, potato, grain, pork and cattle 
     industries.
       If CAFTA fails, it will be in part because the powerful 
     U.S. sugar lobby has plied Capitol Hill with a fictional 
     doomsday scenario in which the trade pact destroys the 
     domestic industry. The truth is American sugar import quotas 
     would rise by a scant 1 percent of the total U.S. market in 
     the first year, and ascend over the next 15 years to a 
     whopping 1.7 percent. What's really at stake for the sugar 
     industry is prices that are two to three times the world 
     market.
       Democrats are leading the assault on CAFTA, claiming the 
     pact's requirement that the countries enforce their own labor 
     and environmental standards is too weak. But this objection 
     ignores the fact that wherever U.S. companies plant 
     themselves in the world, labor and environmental standards 
     invariably rise over time. Voting CAFTA down would surely 
     deal a blow to Central America's reform-minded political 
     leaders. But defeat would also mean the loss of new markets 
     for U.S. workers and farmers, a failure that could cripple 
     America's ability to forge more far-reaching trade 
     liberalization in the coming years.
                                  ____


                 [From the Denver Post, Mar. 26, 2005]

                        CAFTA Worth Our Support

       In two weeks, Congress starts debating a treaty that will 
     shape America's future role in our hemisphere. Since 
     lawmakers previously gave President Bush ``fast track'' 
     authority to negotiate the pact, lawmakers can't change any 
     provisions in the Dominican Republic-Central American Free 
     Trade Agreement (CAFTA)--they can only vote yes or no. We 
     think that vote should be yes.
       CAFTA is modeled on free trade deals Congress OK'd a decade 
     ago with Mexico and Canada, in 2000 with Jordan and in 2004 
     with Morocco. CAFTA would eliminate trade barriers on most 
     goods and services and encourage commerce among the United 
     States, the Dominican Republic, Costa Rica, Honduras, El 
     Salvador, Guatemala and Nicaragua.
       The issue splits Colorado's congressional delegation. 
     Leaning in favor of it are Republican Reps. Bob Beauprez of 
     metro suburbs and Marilyn Musgrave of the Eastern Plains. 
     Leaning against it are Democratic Reps. Mark Udall of Boulder 
     and John Salazar of the Western Slope. Undecided are 
     Democrats Sen. Ken Salazar and Rep. Diana DeGette of Denver, 
     and Republican Reps. Joel Hefley of Colorado Springs and Tom 
     Tancredo of the metro suburbs. Sen. Wayne Allard, a 
     Republican, declined comment.
       Colorado's sugar beet farmers oppose CAFTA because they say 
     it will let cheap, subsidized sugar flood U.S. markets. While 
     concerns may be understandable, Congress shouldn't let one 
     industry decide U.S. hemispheric policy.
       The real arguments in favor of CAFTA involve global issues 
     and the future of our hemisphere's small democracies. Central 
     America will never rival U.S. economic clout--but China is 
     trying. CAFTA could help the Western Hemisphere better 
     position itself to compete with China's burgeoning 
     industries, Central American leaders say.
       As a tool that can help rebuild Central America's 
     struggling economies, CAFTA also has a political dimension. 
     Although Costa Rica has been a stable democracy for more than 
     a half century, its neighbors endured dictatorships, civil 
     wars and insurgencies through the 1990s.
       Central America's democracies are still fragile, and its 
     governments need to show their impoverished people there's a 
     hope for a brighter future. CAFTA is one tool to nurture that 
     hope.
       U.S. foreign policy interests would be well-served by 
     helping to build prosperity and freedom among all the nations 
     in our hemisphere.

  The PRESIDING OFFICER. Who yields time? The Senator from Montana.
  Mr. BAUCUS. Madam President, I yield 20 minutes to the Senator from 
Massachusetts, and ask it be taken off the time allocated to the 
Senator from North Dakota.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Madam President, because we have a number of Senators on 
the floor--I am happy to defer to my senior colleagues, but if we could 
establish a kind of queue? I know Senator Leahy has a statement. I am 
interested in speaking on CAFTA. I ask the distinguished Senator from 
Montana, could we see if we could get an order among the Senators who 
are on the floor?
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. I modify the request: 20 minutes to the Senator from 
Massachusetts taken from the time of the Senator from North Dakota; 
when he has finished, 5 minutes to the Senator from Vermont, that time 
to be taken off the time allocated to the Senator from Iowa. Then, 
following that, I yield 15 minutes to the Senator from Oregon, that 
time to be taken off the time allocated to me.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Massachusetts.
  Mr. KENNEDY. Madam President, I wish my friend from Colorado were on 
the floor. I listened very carefully to his description of the state of 
our economy from 1993 on. As we remember, President Clinton was elected 
in 1992. I think modern economists would say we had the longest period 
of economic growth and price stability in this century--certainly in 
this century, and for at least 100 years during that period of time. 
That is what is reflected in these numbers.
  To tie those into questions about lost manufacturing jobs in terms of 
NAFTA, it is better to look at the various analyses, the business 
analyses that have been done. The EPI studies show that more than 
900,000 manufacturing jobs have actually been lost due to NAFTA.
  I am proud of the record of President Clinton. I was proud to vote in 
support of his economic policies, to put that into play. As a matter of 
fact, it did not have a single vote here by a Republican in the Senate. 
It does reflect in the strong economic indicators that the Senator from 
Colorado showed, but relating that to what were the manufacturing jobs 
that were lost, in terms of NAFTA, I did not hear explained very 
closely.
  I support free trade. I have long voted for trade agreements that 
truly leveled the playing field for our country and for our workers.
  Will the Chair let me know when I have 3 minutes left?
  The PRESIDING OFFICER. The Chair will do so.
  Mr. KENNEDY. Free trade removes unfair barriers to American goods and 
world markets and creates a fair playing field for competition between 
American workers and workers abroad. Free and fair trade creates jobs 
and strengthens our economy. But this Central American agreement is not 
free trade. I urge the Senate to reject this unfair agreement.
  Especially at this time when American workers are deeply concerned 
about their jobs being outsourced overseas, the Bush administration is 
wrong to negotiate an agreement that refuses to protect them. I am 
coming back to that in a moment. It allows participating countries to 
use labor practices that fail to meet international standards. It means 
that American workers, the best in the world, will be forced to compete 
with countries whose workers are abused and exploited. That is not fair 
trade.
  I am for progress and economic development in Central America, dating 
back to President Kennedy's Alliance for Progress. But this agreement 
does nothing to improve labor rights for the workers in the CAFTA 
nations. All it asks is that they enforce their existing laws. It does 
nothing to create a community of nations that respects the basic rights 
and dignity of workers.
  Most CAFTA nations give their workers no real rights such as an 8-
hour day, overtime pay, or protection against discrimination. Laws in 
some CAFTA nations are even hostile to organized labor. Workers in El 
Salvador, Nicaragua, and Honduras can be fired for joining a union or 
even intending to organize a union. In Nicaragua, strikes are 
prohibited without government permission. Even where laws do exist, 
violations often cannot lead to fines or sanctions.
  Those working conditions are not just what I have to say. There is an 
excellent study that was commissioned by the Department of Labor to 
review the working conditions among these countries that would be 
affected by this agreement. When the results came in, what did the 
administration do? They tried to hide the report. They went out and 
pulled all the paper that

[[Page 15024]]

the study had been written on. What the study showed very clearly--and 
I will read the excerpts. The Government-paid study concludes:

       Countries proposed for free trade status have poor working 
     environments and fail to protect workers' rights. The 
     department instructed its contractors to remove the reports 
     from its web, ordered it to retrieve paper copies before they 
     could be made public, banned the release of the new 
     information from the reports, and even told the contractor it 
     could not discuss the studies with outsiders. The working 
     countries are so bad in those countries that the 
     administration's own independent report stated so. Do we have 
     anything in this particular agreement that will do anything 
     about it? Absolutely not.

  Have we at other times tried to do something about the conditions in 
these other countries? We certainly have. The agreement which stands 
out is the Jordanian agreement. In the Jordanian agreement they have 
very clear understanding about what the Jordanians were going to do to 
try to realize the international labor standards. No. 1, they were 
going to eliminate slave trade; No. 2, they were going to make advances 
moving ahead on child labor; No. 3, they were going to permit the 
organizing of various labor organizations with real enforcement going 
in there, and penalties and sanctions if there were a violation. In 
other words, under the labor provisions in the Jordanian agreement that 
was passed by this body, we were moving forward, upward, to meet the 
international labor conditions. That is what ought to be in this 
agreement.
  But is it in this agreement? Absolutely not. Were there any 
provisions in this agreement that, as a result of this agreement, 
American workers would get some kind of compensation for loss of their 
jobs as we have done at other times? Absolutely not. That proposal was 
defeated in the Finance Committee.
  In other words, we are leaving American workers out there, high and 
dry, and are asked to go ahead and pass this without any serious effort 
to provide at least some protection for workers in those countries 
where there are going to be profits that will certainly not trickle 
down to the workers in that country and where real American workers 
will pay with the loss of their jobs because of this agreement.
  CAFTA does not just ignore international standards for Central 
American workers; it also fails to include the aid for American workers 
likely to be displaced. When the Senate Finance Committee debated this 
agreement, it recommended that CAFTA include aid for displaced American 
workers, but the White House ignored the bipartisan recommendation. The 
President effectively abused his power and presented Congress and the 
American people with a take-it-or-leave-it plan. We know it can be 
better and we should reject this defective agreement, send it to the 
White House and go back to the drawing board.
  Although CAFTA is the administration's top trade priority, it 
actually does very little to reduce the Nation's growing overall trade 
deficit. Trade in the region accounts for less than 1.5 percent of 
total U.S. trade. It will barely lead to any improvement in GDP, an 
increase of only one-tenth of 1 percent. Instead of a policy to reduce 
our trade imbalance with China and deal with its currency manipulations 
and WTO violations, the administration has spent more than a year on 
this trade agreement that will do embarrassingly little to improve jobs 
and the economy. It is out of touch with sensible trade priorities for 
this country and ignores the needs of American families.
  I want to take a few moments to show the pressure American families 
are under and why they are wondering why we are considering this 
legislation that provides no protection even for the workers in those 
countries and why it will accelerate additional pressures on American 
workers. Look what is happening in this country. More than 37 million 
Americans, 28 percent of the workforce, work more than 40 hours a week. 
Nearly 1 in 5 workers work more than 50 hours a week. More than 7.4 
million Americans are working at 2 or more jobs, and 300,000 have 2 
full-time jobs. Americans' work hours have increased more than in any 
other industrialized nation. American workers are working longer, are 
doing better, are increasing their productivity. Is there any 
recognition and respect for this extraordinary achievement? I certainly 
do not see it.
  What do we have here? Workers are not benefiting from their work. 
This chart shows there is an increase in productivity from 2001 to 
2004. Productivity is growing 43 times faster than wages.
  Generally, in our country, when we have seen the expansion in 
productivity, we have also seen a growth in American workers' wages. 
That is the way it has been since we have been an industrial nation, 
with the exception of the present, current time. Currently, workers 
have been increasing their productivity--they are working longer, they 
are working harder, and they are increasing their productivity--but 
effectively their wages are stagnant.
  What kind of life do these American workers face? They face an 
increase in their health insurance. Their wages are stagnant, their 
health insurance costs increase 59 percent; college tuition for their 
children is up 35 percent; housing is up 36 percent; and gas 38 
percent. We just passed an energy bill. You would have thought in an 
energy bill we would try to do something about the cost of gas that 
working families and middle-income families are paying every single 
day. Right? Wrong. Wrong. We did nothing. We did nothing about the 
increased cost of gas.
  We took care of the major companies that are producing it, but 
effectively we have done nothing that has helped the workers in that 
particular program.
  Look at what has happened. This President is the first President 
since Herbert Hoover to lose private sector jobs. These are the 
figures: 2001, 111,622,000 were working in the private sector. Now we 
are 111,598,000 in May of 2005. We have seen the reduction of jobs that 
are available in the private sector. There has been some growth, but it 
has all been in the public sector, not the private sector.
  I saw the earlier presentation of the Senator from Colorado. He 
talked about the recoveries we have had. We have seen in this recovery 
of this administration, it is the lowest one we have had in recent 
years. What we find now is, as a result, we have 7.6 million Americans 
who are out of work; 1.6 million more unemployed than in 2001. These 
are the numbers of Americans who are out of work. The ones who are 
working are working longer and working harder.
  This is a quote from Kevin Hassed, director of Economic Policy 
Studies, the American Enterprise Institute, which is a conservative 
institute:

       Usually at this point in a recovery job creation is 
     skyrocketing, but so far that hasn't happened: It's not a 
     partisan issue, it's a fact. The labor market is worse than 
     in a typical recovery.

  These are the economic conditions. Now we have of those 7.6 million 
Americans, they are trying to compete for job openings. There are 3.6 
million job openings in this country. These are hard-working Americans, 
trying to compete for a limited number of jobs.
  Another very important point to know about the condition of American 
workers is the number of those who are long-term unemployed. We have 
seen that grow from 680,000 in 2001 to this in May of 2005, up 1.5 
million. These are the workers who have been unemployed for 26 weeks or 
longer. This is an indication of the stagnation of our economy. Here we 
have seen 2.8 million manufacturing jobs lost over the period since 
2001. There it is, 2.8 million jobs lost, manufacturing jobs lost. They 
have been lost in virtually every one of the States; 47 States have 
lost manufacturing jobs. Now we are being asked to pass another piece 
of legislation that is going to accelerate that? That is what this 
legislation will do.
  We know what is happening to the American workforce. They are working 
longer, harder. They have a greater increase in productivity. Their 
wages are flat. The things they pay for are going through the roof. And 
we know those workers are going to lose their jobs. What jobs are out 
there for them? This is the growth in the next decade, low-

[[Page 15025]]

paying occupations. Seven of the ten fastest growing occupations pay 
$27,000 a year: Retail, food prep, cashiers, janitors, waiters, 
customer reps, and nursing reps.
  We should be in the Senate debating and arguing how we can ensure our 
workforce is employed in the country that has the greatest economy, 
certainly the greatest national security, and the greatest military. We 
want to keep it that way. The way to keep strong is with a 
manufacturing base. The way to do that is invest, invest, invest; 
invest in those workers to make sure they have good training, upgrade 
their training, invest in innovative and creative ways to expand our 
ability to manufacture and expand.
  Are we debating those issues? No, we are trying to pass legislation 
that is going to put workers that do have jobs at greater risk. That is 
what this does.
  It is against this background I mention the latest UNICEF study from 
2004 revealed Costa Rica has 127,000 children working in their plants. 
Guatemala, virtually the same. Those countries are virtually the same. 
Will this legislation get those children out of those plants and 
factories? No. Absolutely, no.
  The interesting aspect, there is one limited program sponsored by the 
Labor Department that permits the Labor Department to inspect plants 
and factories across the country regarding employment of child labor. 
What did this administration do? It cut the guts out of it, 80 percent 
of the appropriation. They cut the guts out of it. Does this add up or 
make sense; an 80-percent reduction in appropriations of the program 
that provides the inspection for child labor in these countries? The 
children are going to be in those sweat houses. Our workers will be 
losing jobs. The American workers are going to be losing jobs. There is 
virtually no penalty. Actually, yes, there is a penalty that could be 
imposed against the country but not against the specific industry. The 
industries really do not care. Those countries will be negotiating 
those penalties.
  It does not have to be this way. We ought to be able to have a 
program that is going to be fair to American workers, uplift the 
working conditions of those countries around the world, and also be 
something that all members of this Senate would be proud to support. 
That is not this legislation. It is heavily flawed. As a result, there 
will be not only enormous numbers of people in that region that are 
going to be exploited, but we will pay for it with the price of 
American workers.
  I yield back my remaining time.
  The PRESIDING OFFICER (Mr. Burr). The Senator from Vermont, under a 
previous order, is recognized for 5 minutes.
  (The remarks of Mr. Leahy are printed in today's Record under 
``Morning Business.'')
  The PRESIDING OFFICER. Under the previous order, the Senator from 
Oregon is recognized for 15 minutes.
  Mr. WYDEN. Mr. President, I have decided to support CAFTA. Because I 
know I will have a lot of welts on my back for it, I want to take a few 
minutes to describe how I arrived at my decision.
  A special concern to me is that if CAFTA is rejected, China will have 
yet another opportunity to grow its economy and strengthen its economic 
base at America's expense. Why Americans would want to do that defies 
logic.
  China is already an economic juggernaut. But as of now, they are not 
going to get duty-free exports to Central America. Only the United 
States has that prospect, and only with CAFTA-DR. If America walks away 
from this agreement, does anyone really think the Chinese will sit on 
the sidelines? As the kids say, ``hello!''
  The Chinese would love the opportunity to get an economic toehold in 
our backyard. I, for one, don't think we ought to give them that 
opportunity. Personally, I believe we ought to be more vigilant in 
terms of watchdogging trade with China than we have been. That is why 
last week I pushed the Bush administration to immediately move to do a 
review of the proposed purchase of Unocal by China's state-run oil 
company under the Exon-Floria law, to examine the national security and 
economic implications of a deal that is essentially unprecedented.
  If you are a free trader--and I am willing to be called that--you 
ought to protect your interests. That is why I favor, for example, 
doing a vigorous review of that proposed purchase of Unocal, and I also 
propose standing up for our interests in Central America rather than 
walking away from the region and handing the Chinese yet another golden 
economic opportunity to strengthen their economic base. In my view, it 
will be an opportunity we have given up, and gratuitously so.
  My view is that with respect to international trade, we ought to make 
things and grow things in the United States of America and then sell 
them around the world. Particularly, I want to sell more value-added 
products made in the United States of America. There is an opportunity 
in Central America to sell those value-added products made in the 
United States such as health care equipment, energy production and 
conservation goods, computer chips, communications gear--a whole host 
of products. The reason I say that is that the Presidents of various 
countries in Central America have written me indicating they are 
prepared to now make those purchases. They are interested in U.S. 
suppliers.
  Some have asked, how is someone in Central America going to have the 
money to purchase these health care products and chips, computers, and 
communications gear? The reality is, the first purchases will be made 
by governments in Central America. The governments have indicated to me 
they are the ones that want to spend on our value-added products: 
computers and chips and energy-production devices.
  For example, Honduras is starting a ``Telephony for All'' program. 
They intend to increase dramatically the number of telephones, wireless 
devices, and the various technologies that will allow them to be part 
of the information age. We ought to make sure those products are made 
in our country and sold there. We will have an opportunity to do more 
of that under this agreement, which will allow us to send American 
exports into Central America duty free.
  Now, I would be the first to say this is not the agreement I would 
have written. For example, I feel very strongly about using the Jordan 
Free Trade Agreement as the model for labor and environmental 
standards. I think it is a major mistake that was not done. I also 
think our inability to get a strong trade adjustment package into this 
legislation is something the Senate will greatly regret.
  I see my good friend from Montana on the floor, Senator Baucus. He 
has championed Trade Adjustment Assistance, along with myself and 
Senator Rockefeller and Senator Coleman. We got 54 votes in the Senate 
not long ago for our bipartisan legislation to try to assist workers 
who are adversely affected by trade.
  It seems incomprehensible that we cannot modernize this program. It 
is decades old. It ought to be extended to service workers. There is 
bipartisan support for it in the Senate. It would be yet another 
message to the workers of this country, who are out on the shop floors, 
that we are concerned first and foremost for their well-being.
  So I am going to continue to come back and prosecute this cause with 
the Senator from Montana. The chairman of our committee, Senator 
Grassley, knows full well how strongly Senator Coleman and I feel about 
it, because it is unacceptable to me there is not a trampoline for 
workers who are adversely affected by trade to get other family-wage 
jobs. We ought to have that opportunity for them to bounce back when 
they are adversely affected by trade. We have it in other areas. The 
failure to extend it to service workers, who could be affected by this 
and other trade agreements, I think is a major mistake.
  There are other changes I would have wanted, particularly in the 
pharmaceutical area. I think this legislation is not well conceived in 
that it clearly favors brand names over generic ingredients. But I will 
say to colleagues that even with these concerns--the inability

[[Page 15026]]

to have a modernization of the trade adjustment program and some of the 
labor issues addressed in the way I would--it is a bigger mistake to 
reject this agreement. If you reject this agreement, you send a message 
to China: You ought to head for Central America as fast as you can 
because you have an opportunity to get a toehold in America's backyard.
  You are denying the opportunity to a lot of American exporters, 
people in Oregon and other states who make those value-added products, 
the high-skill, high-wage products and technologies to sell those goods 
in Central America.
  I want colleagues to know I have met with a lot of those companies 
and the governments in Central America. I would like to see us bring 
them together. There is no reason why energy production and 
conservation products made in our country, and computers and chips and 
health care technologies, should not be sold in Central America, when 
the governments in that part of the world are prepared to make major 
purchases.
  Let's do more to try to make sure those purchases come from American 
exporters rather then Chinese exporters. I urge colleagues to support 
the agreement.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the following 
Senators be recognized in this order: Senator Roberts, 15 minutes, with 
the time to be taken out of the time allocated to the Senator from 
Iowa, Mr. Grassley; Senator Harkin, 20 minutes, with the time to be 
taken out of the time allocated to the Senator from North Dakota; and 
Senator Graham, 15 minutes, with the time to be taken out of the time 
allocated to Senator Grassley.
  The PRESIDING OFFICER. Is there objection?
  The Senator from North Dakota.
  Mr. DORGAN. Mr. President, might we at this point find out what time 
remains of the three allocations of time on this bill? You can proceed 
with the unanimous consent and then perhaps give us the time remaining.
  The PRESIDING OFFICER. The Senator from Iowa has 7 hours 7 minutes 
remaining. The Senator from Montana has 2 hours 50 minutes remaining.
  Mr. BAUCUS. Two hours 50 minutes?
  The PRESIDING OFFICER. Two hours 50 minutes.
  Mr. BAUCUS. Thank you.
  The PRESIDING OFFICER. The Senator from North Dakota has 3 hours 52 
minutes remaining.
  Mr. DORGAN. I thank the Presiding Officer.
  The PRESIDING OFFICER. Is there objection to the unanimous consent 
request for Roberts, 15 minutes; Harkin, 20 minutes; and Graham, 15 
minutes?
  Without objection, it is so ordered.
  The Senator from Kansas is recognized for 15 minutes under the 
previous order.
  Mr. ROBERTS. I thank the Presiding Officer.
  Mr. President, today I rise in support of the Central American and 
Dominican Republic Free Trade Agreement called CAFTA. I also want to 
state a word of caution in regards to an issue that is commensurate 
with this vote; and that is the waning support for free trade in this 
country, more especially in farm country.
  It was not long ago when the prospect of expanding our trading 
opportunities with our neighbors across the ocean--the 96 percent of 
the rest of the world in terms of trade--was met with great optimism 
and urgency. I do not know of anybody who made a farm speech who did 
not say: OK, point No. 2, point No. 3--in the laundry list of things 
they were trying to get done in Washington--without involving trade and 
expanding exports. Times have changed.
  Today I think we are suffering from what I call ``trade fatigue.'' 
That is to say, many times we oversell and we overestimate what is 
going to happen in regard to the expectations of a particular trade 
agreement. We oversell it. I know that many more times we overcriticize 
them. As a result, in farm country, I think our producers of food and 
fiber are a little weary and a little wary of this animal we let out of 
the chute called free trade.
  There have to be better examples, specific examples, in regard to how 
our producers basically benefit from free trade during very challenging 
times in farm country--a time when we see a lot of industry 
concentration going on and consolidation, not only in farm country but 
throughout our entire economy.
  Well, I am privileged to represent the State of Kansas where farm 
exports support over 47,000 jobs, both on the farm and in food 
processing and transportation. Farm exports from the State of Kansas 
are estimated at $3 billion, compromising one-third of all farm income. 
Our State is the Nation's top exporter of wheat and the second largest 
beef exporter, both of which rely heavily on increased market access. 
In short, an opportunity such as CAFTA is going to be essential for 
Kansas.
  But in my hometown of Dodge City, and in the rest of farm country, 
you hear the discussion of trade and exports, and there is some 
reservation, not expectation. I do not think it is isolationism. I do 
not think it is protectionism. Too many times farm organizations and 
commodity groups are looking out for their own commodity interest 
instead of the big picture, which involves opportunity for all American 
farmers and businesses.
  Perhaps more importantly, this is an issue of national security and 
stability, just south of our border as well. Let me touch on that.
  Our country has benefitted from trade agreements with Chile, 
Australia, Canada, and Mexico. Since NAFTA was signed--you do not get 
the specific instances of this in the press; you always get the 
instances of somebody who has suffered economically or seen their job 
outsourced or whatever--but basically, these Kansas exports to Canada 
and Mexico combined have increased by more than 120 percent. In the 
first year of the Chilean Free Trade Agreement, our Kansas exports to 
Chile actually grew by more than 9 percent.
  CAFTA will build on this trend by securing 44 million new consumers. 
Under the agreement, half of the current U.S. farm exports to CAFTA 
countries will become duty free immediately. This includes high-quality 
cuts of beef and cotton and wheat and soybeans--major commodities.
  Under the existing World Trade Organization commitments and tariff 
preferences, most exports under CAFTA countries already enter the U.S. 
duty free. However, U.S. exports could face potential tariffs of up to 
250 percent in the case of beef. Despite these tariffs, why, our 
producers in Kansas exported to CAFTA countries a total of $23 million 
last year.
  Earlier this month, the U.S. Census Bureau reported that our Nation's 
international trade deficit measured $57 billion. That was a $4 billion 
increase from previous reporting. As we face the growing competition in 
global agriculture, it is more important than ever to secure duty-free 
rates in these countries.
  Now I want to touch on this business of security just south of our 
country. As chairman of the Intelligence Committee, and as a member of 
the Armed Services Committee, I must stress this agreement is not only 
about expanding market access. We are talking about stability, 
stability within these countries, and our own national security. 
Specifically, I am talking about the big issues of immigration, drug 
trafficking, and energy.
  If you put in Mexico and Venezuela, for instance, albeit they are 
adjacent to the CAFTA countries, we are talking about 23 percent of our 
energy supply. I do not think it is an exaggeration to say that without 
this trade agreement we run the risk of these countries falling prey to 
others who have far less interest in democracy and stability than in 
manipulation and power within these countries. I do not want to go back 
to the days of the 1980s. I do not want to go back to the Nicaraguan 
situation and Danny Ortega. That is not in the best interests of these 
countries in the region, and it certainly is not in the best interests 
of our national security.
  So given this reality, it is difficult to understand how the 
interests of one

[[Page 15027]]

commodity--one commodity; and I am talking about sugar--has largely 
outweighed the potential for regional stability in CAFTA countries. In 
the past, whether in trade agreements or trade disputes, whether it be 
in farm bills or budget reconciliations, our commodity and producer 
groups sank or swam together. We either hung separately or we basically 
tried to hang together.
  But today that is not the case. And, I am not trying to pick on the 
sugar industry or the sugar representatives or the hard-pressed sugar 
producers in the United States. It is just that I am terribly concerned 
that instead of ``one for all and all for one,'' we have ``all for one 
and one for one.'' And that is not right in regards to how we approach 
this from the standpoint of the agriculture interests in this country.
  Sugar is already under one of the most protected U.S. agricultural 
programs. In fact, when compared to the rest of the world, our 
producers enjoy the highest world price for their product. I know about 
their cost inputs. I know about the difficulty, but my previous 
statement is correct. In recent years, we have journeyed down a 
dangerous road in our negotiations with the Australian Free Trade 
Agreement and now with CAFTA, by allowing the singular interests of one 
commodity to dictate the livelihood of a comprehensive and well-
intended agreement. I do not think it is right for one commodity to 
dictate in regard to their self-interests to the detriment of other 
interests in agriculture.
  I remember the whole-herd dairy buyout, which pretty well ruined the 
entire beef industry. I do not want to go down that road again. I think 
this is an example of that case.
  Under CAFTA, during the first year of the agreement, allowable sugar 
imports will amount to only a little more than one day's U.S. 
production--one day. The Secretary of Agriculture pulls out of his 
pocket two sugar packets and says that is what every consumer will have 
in extra supply in regard to the CAFTA agreement. Despite the nominal 
projected effect on the U.S. sugar prices and production, our domestic 
sugar industry has demanded that they go unharmed by this and, 
plausibly, by any other trade agreement.
  Despite efforts by the administration and others to try to reach some 
accommodation, many in this Congress support the sugar industry--and I 
have as well. As chairman of the House Agriculture Committee during 
1996 and through six farm bills, I tried to be helpful to the sugar 
industry. Every time we have a reconciliation bill, every time we have 
an appropriations bill, every time we have any votes on a farm bill, we 
have tried to be of help to the sugar industry. Usually those votes are 
very close, by two votes, four votes, five votes in the House of 
Representatives, and the same happens in the Senate. So you stand up 
and say: OK, let's really try to stay together in regard to the 
agricultural lobby and be fair to our producers nationwide, nobody 
singled out. I am saying to the sugar industry, you may win this 
battle, but you may also lose the war.
  Sugar's insistence upon receiving special treatment makes it very 
likely that the rest of agriculture, which overwhelmingly supports 
CAFTA, may opt not to participate in sugar's defense the next time that 
program faces a WTO challenge, budget reconciliation measure, and the 
endless amendments to end sugar's support program during the next farm 
bill. Let that warning be heard.
  Some of my colleagues have expressed their concern--we just heard 
Senator Wyden, the distinguished Senator from Oregon--in regard to 
labor and human rights standards in the CAFTA countries, arguing the 
agreement does not set strict enough standards in these areas. I am 
concerned about the environmental concerns in these countries and the 
labor concerns in regard to these countries and the human rights 
standards, but trade agreements are not the appropriate forum for 
addressing these issues. Basically the country will say: Thank you very 
much. We are a sovereign country. We are not going to trade with the 
United States. We will trade with somebody else. We will address these 
problems on our own. It is a little bit impervious in regard to that 
concern.
  I don't think we can expect these countries to establish and value 
the same high labor standards we have overnight. Rather, we should 
encourage and facilitate the emergence of such standards.
  Today the most important question is not what happens if we approve 
CAFTA but, rather, what would happen if we don't pass this agreement. 
Only an ocean away, China is aggressively pursuing opportunities to 
compete in both the high tech and production agricultural sectors. We 
have only gotten a glimpse of the economic capability and resources of 
this country. Furthermore, we face additional and continued threats and 
allegations from the WTO in regards to our international food aid and 
export programs. I am talking about our food aid and export programs. 
The recent cotton case brought by Brazil is one of the most serious 
agriculture trade disputes we have ever faced. And farm country has not 
awakened to this challenge. The Senate has not awakened to it. The 
ramifications of this decision in this case are far-reaching and could 
potentially affect every section of our farm export programs.
  If we fail to approve CAFTA, we stand to lose credibility in these 
negotiations and, in turn, the ability to aptly protect the food aid 
programs and the development assistance that are essential in our war 
against terror and our efforts to prevent children in the Sudan from 
going hungry.
  We have not come this far to take one step forward in the WTO and, 
with our other bilateral trade negotiations, to take two steps backward 
by failing to approve CAFTA. If we do not approve CAFTA, I don't know 
what we do with the Free Trade in Americas Act. I don't know what we do 
as we go into the WTO negotiations facing the Brazil challenge. I don't 
know what we do in the next farm bill in regard to how we structure the 
farm bill if we do not rely on trade and exports, at least to the 
realistic degree that we should. What do you do? Do you write the farm 
bill and say: Go back to your domestic production and then pay a higher 
subsidy for which we do not have the budget dollars? I don't think so.
  I urge my colleagues to support this agreement. It is in the best 
interest of the United States, not only on behalf of agriculture and 
all the other business activities that will benefit from the agreement, 
but also from a security standpoint as well.
  I yield the floor.
  The PRESIDING OFFICER. Under the previous order, the Senator from 
Iowa is recognized for 20 minutes.
  Mr. HARKIN. Mr. President, as the Senate debates the Central American 
Free Trade Agreement implementing legislation today, we know that it 
has been more than 13 months since the United States and its six 
partner countries in Central American and the Dominican Republic 
formally signed the agreement. So what has taken so long? The reason I 
think for the long delay, obviously, is that supporters have had a hard 
time selling this agreement to the American people. The supposed 
benefits are murky, in the distance, while the flaws are all too 
obvious. This is a shame because we could have a much better agreement 
that would have won broad bipartisan support.
  I have evaluated CAFTA with a genuinely open mind, having supported 
most major trade agreements during my three decades in Congress. I have 
no philosophical or ideological bias for or against trade. Far from it. 
I take a strictly pragmatic approach, and generally I am in favor of 
trade. But that same pragmatism tells me that it is folly to load all 
of our economic and diplomatic hopes on the slender back of inadequate 
trade agreements.
  As has been my practice with past trade agreements, I have carefully 
weighed the prospective advantages and disadvantages of CAFTA. Under 
the fast-track procedure, our only option is to vote up or down. And 
late last evening, after thoroughly looking at this, I finally had to 
come to the conclusion that the problems with CAFTA, as we have it 
before us, clearly outweigh the very small benefits. On

[[Page 15028]]

balance, the facts and reasons against CAFTA are significantly stronger 
than the arguments for it. Therefore, I must vote no on this 
implementing legislation today.
  As one would expect, proponents of CAFTA have presented a glowing 
picture of the agreement's benefits, but there has been an awful lot of 
overselling, in some cases outright exaggeration about how important 
this agreement really is. Let's take agriculture, for example. On 
paper, CAFTA appears to offer opportunities for some U.S. farmers and 
negatives for others, and the magnitude of these pluses and minuses is 
part of the debate. But while in theory agriculture should benefit 
overall, the projected benefits are strikingly modest, and they come 
many years in the future.
  Economists at the American Farm Bureau Federation estimate that U.S. 
agricultural exports would increase by about $1.5 billion a year when 
the agreement is fully effective. That is 15 to 18 years from now. So 
if we assume an average annual inflation rate of about 2.3 percent, 
that $1.5 billion increase by 2024 would be only about $930 million in 
today's dollars. That is about 1.5 percent of our total agricultural 
exports. So the benefits 15 to 18 years from now, calculated in today's 
dollars, are relatively small.
  There is one other aspect to this. The International Trade Commission 
of the U.S. Government also had a study. It showed that they predicted 
a $100 million decline in net annual exports from the United States to 
the six partner countries as a result of CAFTA. So we get a small 1.5-
percent increase in agriculture in 2024. But the International Trade 
Commission says we are going to have a $100 million decline in net 
annual exports from the United States.
  Whether CAFTA's modest predicted benefits actually materialize is in 
dispute. Average per capita income in CAFTA countries is about $1,800 a 
year. Are they going to become good customers? About a third of the 
population there lives on $2 a day or less. How are they going to buy a 
New York strip steak or one of our delicious Iowa pork chops that some 
are so optimistic that we are going to export to those countries?
  Potential for big gains is further limited by the fact that we 
already dominate trade in those countries. In 2003, we accounted for 
about 45 percent of all merchandise exports to the region. The benefits 
that CAFTA backers optimistically predict are based on the assumption 
that CAFTA will spur economic growth in these generally poor and small 
countries. Right now, under existing trade preference programs, these 
six countries already face zero tariffs on 80 percent of the goods they 
ship to the United States, meaning that additional tariff reductions 
will not spur significant economic growth in those countries. Many are 
skeptical of these claims about CAFTA and the economic growth in 
Central American countries.
  One of the reasons that has moved me to the ``no'' column on this is, 
I recently had a meeting in my office with a Catholic bishop, Bishop 
Alvaro Ramazzini, a senior Catholic prelate in Guatemala, who came to 
my office to lobby against CAFTA. I spent time with him. I quizzed him 
about it. I wanted to know why he felt so strongly that CAFTA would not 
be in the best interest of his parishioners. He said that he and other 
advocates for the poor in Central America opposed CAFTA because its 
benefits would go mostly to the economic elites and it would deepen the 
disparity between rich and poor. So if, as the bishop says, CAFTA would 
not raise incomes broadly for Central America's people, it won't help 
them and it won't help us.
  The previous speaker mentioned something about Daniel Ortega. Talk 
about a ghost out of the past. I am talking about the Catholic bishop 
of Guatemala who came to this country a few months ago to tell us that 
this would not be in the best interest of his small farmers, his 
campesinos, and their families. He said it would drive them off their 
farms and push them more into cities where there is no work for them.
  CAFTA will make it harder for U.S. workers, farmers, and businesses 
to succeed in the increasingly competitive global economy. We can 
compete on a truly level playing field. It is not fair competition if 
other countries allow their manufacturers or farms to disregard 
internationally recognized labor rights and child labor protections or 
if those countries have lax or nonexistent environmental rules. This 
CAFTA does virtually nothing to deal effectively with the competitive 
issues relating to labor and environmental standards. For labor, the 
internationally recognized rights are pretty basic, such as the right 
of association and bargaining, prohibition of forced or prison labor, 
and protection of children from working at young ages or in hazardous 
or exploitative jobs. I have worked for many years in the effort to 
eliminate abusive child labor around the world. It is morally wrong, 
and it leads to all kinds of other injustices and inequalities.
  Reports from our own Department of State and the International Labor 
Organization have documented labor rights and child labor problems 
throughout the six countries of CAFTA. Just yesterday morning, we 
learned that our U.S. Department of Labor had been hiding from us a 
report it commissioned that found serious labor violations in the 
countries that signed CAFTA. Right now--this is what is important--
under current U.S. law, if one of those CAFTA countries condones 
abusive child labor or other violations of internationally recognized 
labor rights, we can keep that country from shipping goods to us at low 
tariff rates. In other words, our U.S. trade law right now allows us to 
enforce international labor rights. This came about because in 2000, I 
worked with then-Senator Jesse Helms to modify our Generalized System 
of Preferences Program, the GSP Program, so that countries that allow 
abusive child labor are ineligible to ship products to the United 
States at low GSP tariffs.
  The other provision is in the Caribbean Basin Initiative. It allows 
our Government to deny the benefit of lower CBI tariffs to enforce the 
broader set of internationally recognized labor rights; that is, if a 
country is tolerating violations of international labor rights, we can 
take action so that goods from that country coming into the United 
States are subject to a higher tariff than is applicable to goods from 
other CBI countries. In fact, we have taken action under that CBI 
provision against violations of international labor rights.
  So right now, as pertains to these CAFTA countries, we have strong 
provisions in law to protect against child labor and internationally 
recognized labor rights. Guess what. CAFTA would supersede and abolish 
both of these labor rights enforcement features of our current U.S. law 
with respect to the six other CAFTA countries. Talk about a giant step 
backward. Five years ago, this Congress added--and the President signed 
it into law--provisions that protect children, protect people who want 
to organize and bargain collectively, protect against forced or prison 
labor in these countries. Guess what. CAFTA does away with it.
  What is happening? I thought we were supposed to be progressing in 
the world, in terms of recognizing basic, fundamental human rights. 
What could be more fundamental than the human right of children not to 
be exploited and find themselves in abusive types of labor situations 
and forced to work? Yet, CAFTA removes these countries from being 
covered by those laws. It says: Fine, if one of these countries were to 
use kids working in places where it would be in violation of 
internationally recognized human rights labor standards, we cannot do a 
thing about it--nothing. Today we could. When CAFTA passes and goes 
into effect, we won't. Not too many people know that. I guess that is 
the major reason why I am opposing this CAFTA--the giant step it takes 
backward in protecting against abusive child labor.
  Under this bill, we have no ability to hold a CAFTA country to 
internationally recognized labor rights and child labor protections if 
its own laws are

[[Page 15029]]

weaker than the international standard. So we are faced with a 
contradiction. One of the big reasons that I keep hearing to support 
CAFTA is to boost economic and social progress in these countries. Yet, 
we are taking a giant step backward in our ability to press our CAFTA 
trading partners to combat abusive child labor practices and other 
violations of internationally recognized labor rights.
  Elsewhere, this administration insists on social and political reform 
as a condition for allocating aid to developing countries. For example, 
eligibility standards for the Millennium Challenge Accounts require 
progress on social and political fronts. Why should we jettison such 
requirements under CAFTA? Should free trade come at the cost of 
progress in combating abusive child labor practices? Of course not. It 
is not acceptable for me, and it should not be for any of us. That is 
the problem with the bill before us.
  Again, if the President would have worked with us and consulted with 
us in good faith and said we are going to keep these provisions that we 
put into law in 2000 and the provisions we put in the Caribbean Basin 
Initiative to protect child labor, well, you've got my vote. But they 
didn't do that. In discussions with U.S. negotiators before the text 
was completed on CAFTA, Members and staff made clear our concerns about 
all these issues. Unfortunately, little or no effort was made to 
address those concerns until after the agreement was completed and the 
White House recognized it might fall short of the necessary votes. At 
that point, it was too late; the final agreement had been negotiated.
  Mr. President, from a broader view, the modest benefits that we are 
theoretically promised 15 years from now under CAFTA simply do not 
offset the harm it will do to kids and poor people and small farmers in 
those countries. The modest benefits do not compensate for what is 
going to happen if our small manufacturers in this country rush down 
there for cheaper labor, lower environmental standards, make products 
down there, pay people low wages, don't give them decent benefits, 
don't recognize appropriate labor standards, use children as workers, 
dump the refuse out in the environment, and then ship the products back 
to the United States. That is what we are voting on here.
  Mr. President, I don't consider this agreement worthy of passage. 
Modest benefits, 15 years from now, may or may not be realized. But we 
are taking a giant step backward in terms of protecting labor rights 
and child labor and the environment. For that reason, I believe this 
CAFTA bill, as it is written, is a big mistake. I do not oppose all 
free-trade agreements with Central America. But for these reasons, I 
oppose this one. We can, and we should, do better for our people, our 
farmers, our small manufacturers but also for the poor people of 
Central America and the campesinos there who need to have their 
standard of living raised, not have their children working and not 
going to school, not have refuse dumped into the environment which 
threatens their health in the future. That is why this is unfair. That 
is why it ought to be defeated. We ought to have a better trade 
agreement than this one.
  With that, I yield the floor.
  The PRESIDING OFFICER. Under the previous order, Senator Graham was 
to be recognized.
  The Senator from Montana is recognized. Who yields time?
  Mr. BAUCUS. Mr. President, I do not see Senator Graham here. I ask 
unanimous consent that the order be vitiated, and I will yield to him 
when he arrives.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Montana is recognized.
  Mr. BAUCUS. Mr. President, in a narrow sense, the Senate today is 
considering the free-trade agreement with five Central American 
countries and the Dominican Republic, but in a larger sense, the Senate 
is debating how the United States can remain competitive. In a larger 
sense, the Senate is debating how America can continue to earn $37,000 
per person, or more, when there are hundreds of millions of people in 
China who earn $1,100 per person a year.
  Little agreements like that before us today cannot be the answer. It 
may be a partial answer but, frankly, in the larger scheme of things, 
it is really much less important than the central question facing 
America today with respect to economic competitiveness. The agreement 
before us today will not open enough markets for American exports to 
make that much of a difference. That is clear.
  No, we need a much more aggressive strategy. On trade policy, we need 
to try to negotiate bigger agreements--not these small ones, but bigger 
ones that have much greater commercial value. We need to open 
negotiations with trading partners who represent a larger share of 
American trade. There are many examples. We are not doing that, but we 
should and we must. Time is ticking by. We need to give renewed 
emphasis to multilateral agreements like the Doha Round. And we need to 
do a better job enforcing the trade agreements we have already entered 
into.
  Each Senator can list many agreements the United States has entered 
into with other countries, but the other countries, by and large, have 
not lived up to the agreements. The most glaring example is 
intellectual property. We know who the countries are that have not 
lived up to their obligations to honor intellectual property rights 
and, as a result, American companies are losing billions of dollars a 
year. The United States must be much more aggressive in enforcing those 
agreements.
  We need to improve America's education. We need to ensure that we can 
remain more productive than workers in other countries. That too is 
clear. We need to give teachers the recognition and compensation they 
need to ensure that they can help to educate the most productive 
workers in the world. We need to increase the incentives for students 
to study the basics--math, science, engineering. Why? So that American 
students can remain the source of tomorrow's new ideas. We pride 
ourselves--we have in the last several decades--in being the country 
that is the most innovative and creative, and that has been true. We 
also know that others are catching up. There is no reason why people in 
other countries cannot be as creative and as innovative as Americans. 
There is no reason--none. They are people, and we are people. They are 
human beings, as we are. Their brains are the same as our brains. It 
really comes down to who is the most educated, the most aggressive, who 
works the hardest, and who works better together. And people in other 
countries are becoming very well educated, very aggressive. They are 
hungry. They are working closely together, and they are investing in 
areas to increase their productivity. They are catching up very 
quickly.
  We also need to increase our national savings. America has an abysmal 
national savings history. It will not be much longer, if that trend 
continues, when we are going to face very dire economic consequences. 
We have to do something about that; we are not. Our private savings 
rates are zero. Americans do not save. They spend. We spend. We like to 
buy refrigerators, cars, boats, clothes. We consume; we do not save. 
With housing prices so high these days, what do we do? We borrow 
against the equity in that house. What do we do with the borrowing? We 
spend. To make matters worse, the Federal Government not only has a 
savings rate of zero, it has a dissavings rate, huge deficits and 
debts.
  We cannot continue like this. That is one part of the agenda that we 
must work on if we are going to address American competitiveness. This 
agreement before us is an important debate, but it is not the real 
debate. It is an important issue, but it is not the real issue. It is 
only a small part of the central issue we should be facing. We need to 
expand incentives for employees to save through work, for example. 
There is no glamor or rocket science in this. It doesn't make the 
evening news. That is one reason we don't do it because we are people 
with such a short attention

[[Page 15030]]

span. It is the instant view--what is now--and not what can be 10, 15 
years from now. We need to expand incentives for employees to save 
through work, which is a small step in the right direction to increase 
savings. We need to stop running massive Federal budget deficits 
because they are reductions in national savings.
  We need to address our outsized and very expensive health care 
system. We spend twice as much on health care per capita than the next 
highest country. I ask, are we twice as healthy? Of course not. We are 
not twice as healthy. Why do we spend twice as much? A lot of reasons. 
It is very complex, but we do. What is the consequence of that? One 
consequence, clearly, is that our companies are having a very difficult 
time competing--particularly our larger, older companies. They have 
extremely high health care costs, legacy costs to employees and 
retirees. Their competitors don't have them nearly that high.
  I have talked to CEOs of large companies who say they are thinking of 
locating their plants in other countries largely because the health 
care costs for those employees in those countries is much lower and so 
they can compete.
  I remind my colleagues, this is an incredibly competitive world. It 
is incredibly competitive, and just the slightest margins make a 
difference. We have to, therefore, be incredibly competitive ourselves. 
It is teamwork. It is Americans working together. We are not working 
together.
  Look at this debate. This debate is pretty sterile. One side 
exaggerates; the other side exaggerates. We are not talking with each 
other. We are not focusing on the real problem. I hope in future days, 
weeks, and months we start to wake up and not get so involved with the 
periphery. CAFTA is not really the periphery, but it is not far from 
the periphery. We should, rather, focus on the central questions.
  We also need to foster much greater use of information technologies 
in health care. Did you know, Mr. President, that the equivalent of two 
747s crashing every day is the number of Americans who die on account 
of medical errors? Between 58,000 and 98,000 people a year in America 
die because of medical errors. It is not true in other countries. It is 
in America. Much better information technology in the health care 
industry will reap immense benefits.
  What is one of the reasons we do not invest in IT in America in 
health care? It is pretty simple. It is reimbursement. Hospitals will 
spend thousands of dollars on CAT scans and on PET scans, the latest 
technologies. Why? Because the Medicare program reimburses them for 
those machines. It is also competition, keeping up with the Joneses. 
What is the Medicare DRG for IT? There isn't one. We have a system that 
reimburses and sets up incentives that discourages development of IT in 
health care, which we have to have, which will reduce medical errors. 
It will have all kinds of positive consequences if we get a much better 
IT system. We have to get going in this country. We are behind the 
eight ball.
  In sum, to be competitive, we need to have a plan. This is a bit 
simplistic, but I think it somewhat makes the point. I mentioned 
earlier how competitive this world is. We all know that. If we put two 
teams on the playing field--by the way, I am an American. I am for the 
American team. I do not want to denigrate other people or hurt other 
people. The ideal is that everybody around the world is doing extremely 
well. I am an American. I am on the American team. I want America to do 
well.
  If we put two teams out on the playing field--let's take football. 
One team has a quarterback, blocking backs, the linemen, they have a 
coach, a play, a plan. That is one team. The other team has 11 players 
on the field. One person wants to do one thing; he wants to carry the 
ball. Someone else says: I want to carry the ball. No, I want to kick. 
No plan, no coach. They are out doing their own thing. They are 
entrepreneurial. It is free competition, going in their own directions, 
doing what they want to do.
  Which team wins? I grant you, that is simplistic. That is very 
simplistic, but I think it does make a point.
  Other countries have plans. I can name them: China. China has a plan. 
Japan has a plan. I think some European countries do; I am not sure. I 
do not know how much better organized they are, but the main point is 
we do not have a plan. I am not asking for a centralized plan where 
somebody decides what everybody does, but I am asking for much greater 
cooperation, much more working together so that Americans can compete.
  I go back to what I said earlier. So much of this is education. It is 
value added. We need to add value up here at all levels--K through 12, 
continuing education, vo-tech, and so forth. Ultimately, that is where 
it is at--education. There is nothing else but education--math, 
science, and other areas.
  I see the Presiding Officer taking notes. I can see he is listening 
to me. I can tell I am making some points that maybe make sense and he 
is going to do something about it. I appreciate that. I wish others 
would, too.
  Mr. President, I ask unanimous consent that the following Senators be 
the next recognized for debate: I see Senator Graham is in the Chamber. 
He will have 15 minutes, and that time will be taken out of the time 
allocated to Senator Grassley. Senator Conrad of North Dakota wants 15 
minutes, and his time will be taken out of the time allocated to 
Senator Dorgan. Senator Thomas will be recognized for 15 minutes, and 
his time will be taken out of the time allocated to Senator Grassley.
  The PRESIDING OFFICER. Is there objection?
  Mr. GRAHAM. Mr. President, I believe my time should come from Senator 
Dorgan because I oppose the bill.
  Mr. BAUCUS. I do not know that it matters, Mr. President. For the 
sake of moving along, we will stick with what we have.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Under the order, the Senator from South Carolina is recognized for 15 
minutes.
  Mr. GRAHAM. Mr. President, I thank Senator Baucus. Senator Baucus 
made some very telling points that I think we should all listen to in 
trying to get a game plan.
  I rise today as a ``no'' vote to CAFTA. I do not think that surprises 
many people. The point I am trying to make with my vote is many of the 
things being said about the benefits of CAFTA are very true. I think it 
will help the Central American countries, the CAFTA nations that are 
trying to emerge as democracies in some regard. There will be some 
benefit to the economy. There is no doubt there is some benefit in any 
trade agreement. But my concern is of a geopolitical concern dealing 
with China.
  The trade agreement we negotiated with Central America, the CAFTA 
agreement, has many loopholes that China will exploit, just as they 
have exploited every other trade agreement we have done. The cumulative 
effect of China on our trading situation throughout the world and our 
relationship is becoming devastating.
  In April, the U.S. trade deficit was $62.2 billion. With China it 
grows $7.83 billion per month. Since we gave PNTR status to China in 
2001, the trade deficit with China has gone from $100 billion to $162 
billion. It is 47 percent greater this year than it was last year.
  It has been devastating to the textile and other industries. During 
the first quarter of 2005, imports from China have grown 1,250 percent 
for cotton knit shirts and blouses, 1,500 percent for cotton trousers, 
and 300 percent for cotton and manmade underwear.
  The bottom line is products coming in from China are not conforming 
with international trade regimes. They are not conforming with the 
standards we would like to see throughout the world.
  The bottom line is they are cheap. They take advantage of trade 
agreements negotiated--NAFTA and eventually CAFTA--through 
transshipments. What is going to happen very clearly, to me, is Chinese 
companies will move into the CAFTA. They will take material made in 
China with slave-wage conditions, horrible conditions, throw a label on 
it as if it were made in

[[Page 15031]]

CAFTA, and get it into our country in a way they could not do directly 
from China. It is called transshipment.
  Particularly, this agreement is poorly drafted. It does not realize 
exactly with whom we are dealing. The combined effect of the CAFTA 
nations, in terms of a market for us, is the size of San Diego. So 
those who sell this agreement as a major way to create export 
opportunities for America I think are not realistic. If you took all 
the combined countries' economic buying power, it is the size of San 
Diego, and that is not going to fuel the American economy.
  We are going to see goods from the CAFTA nations cheaper than we can 
produce here. It is going to have an effect on manufacturing in my 
State and other States that will be part of an overall trend that is 
getting to be more than we can bear.
  China will take advantage of this. It has many loopholes for China. 
The rule of origin provisions requiring a yarn for arrangement is only 
for the essential fabric of the garment. What that means in English is 
we are trying to lock down the fabric and the yarn to be tied to our 
country, to give a benefit to our textile manufacturers, and that is a 
good thing. That helps us get into that market.
  It does not deal with pockets, collars, and nonvisible jacket liners. 
They are exempt from that yarn for arrangement. There is a side deal 
having to do with pockets to address what will happen in my State. I 
have about 500 to 600 workers who make pockets for garments. The 
Chinese companies are going to put them out of business because the 
pockets to be made in a CAFTA nation are not going to come from South 
Carolina or other places in the United States. They are eventually 
going to come from China because the pocket agreement, trying to 
protect the pocket part of a garment, requires all six CAFTA countries 
to ratify it. That is just not realistic. It is not going to happen. So 
there are going to be people in my State, unfortunately, if this gets 
passed, who are going to be put out of a job because China is going to 
come into the CAFTA region and they are going to put American 
manufacturing, when it comes to textile goods with regard to pockets, 
out of business.
  There are other loopholes. The single transformation provision allows 
for pajamas, boxer shorts, and bras to be imported into the U.S. duty 
free regardless of origin so long as they are assembled in a CAFTA 
country. In other words, you can have all the material made in China 
for these products and do the sewing in CAFTA, and they come into our 
country, and that is going to be devastating to Fruit of the Loom and 
other people who have come by to talk about it.
  This agreement, like all other agreements I have voted for, except 
Australia, which I thought was a pretty good deal for America, has 
major loopholes within it to allow China to take advantage of it even 
though they are not party to it.
  The problem we have with China and the way they manipulate their 
currency, the way they have no regard for intellectual property, the 
way they transship by cheating, sending goods from China into other 
regions of the world where we have existing trade agreements, is having 
a cumulative effect.
  We have lost 21.6 percent of the manufacturing jobs in South Carolina 
in the last 5 years. Some of it is due to modernization. Some of it is 
due to factors beyond international trade. But a lot of it has to do 
with international trade that is not being fairly policed.
  We have a 6.5-percent unemployment rate in South Carolina. We are 
fifth in the Nation. Our State has a manufacturing-based economy. The 
side deals that are being touted for people in this agreement are going 
to be like most other side deals when it comes to agreements in the 
last 15 years. Eighty-three percent of these agreements, according to a 
report by Public Citizen, a watchdog group, were not kept, reversed, or 
became meaningless.
  So my concern about CAFTA is my concern about trade in general. Until 
we regulate and get buy-in by the Chinese to live within the family of 
nations when it comes to trading and doing business, every time we 
expand an area of trade, it becomes another portal for China to enter 
into our marketplace and to do things they could not do in a direct 
relationship with the United States.
  They will be able to do things in the area of textiles in the CAFTA 
countries they could not do directly with the United States. It is just 
not going to be textiles. Eventually it is going to be other products.
  The buying power of these nations, again, combined is the size of San 
Diego, but what will happen is the ability of China to exploit this 
agreement is going to be much larger than the buying power of San 
Diego.
  I do believe that trade can help emerging democracies and that there 
is a logic to the idea the President is proposing for these emerging 
democracies for which we could create economic opportunity.
  However, unfortunately, I believe the way this deal has been 
negotiated, the way it will be implemented, and the way it will be 
exploited is not going to improve the democracies in Central America 
because they are going to lose jobs to China eventually. It is going to 
hurt the manufacturing base of this country, which is already in 
jeopardy. That is why I will choose to vote no.
  I yield the floor and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. THOMAS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. THOMAS. Mr. President, I will take a few minutes to talk about 
the topic that is on our agenda today, the CAFTA trade agreement. 
Certainly, it is something in which all of us are interested. Trade 
agreements are very important, of course, and whether they fit or not 
they are always there and we have to deal with them.
  Frankly, I have been very involved in this, partly because sugar is 
one of the products from my State and it is one of the things that has 
been a very controversial portion of this trade agreement.
  Trade agreements are not easy. Whether we like it or not, trade moves 
around the world and so what we need to do is to find a way to make 
that trade work as well as we can for ourselves and for others. 
Sometimes I am a little disappointed. When we passed the free-trade 
agreement, I think we should have called it the fair-trade agreement. 
Free trade is not always the way things are.
  There is a book called ``The World Is Flat,'' talking about how there 
is equality throughout the world, but it is changing. Well, it is 
changing, but it has not all changed. There is a great deal of 
difference between one country and another in terms of their economy, 
in terms of the way it works and whether one is getting paid $2 a day 
or $20 a day or $20 an hour.
  So when one talks about free trade, one has to make sure that they 
recognize the differences that are there. All I am saying is it is 
difficult. Of course, we want to work with other countries. Part of the 
reason for having CAFTA before us is we are looking for relationships 
with the Central American countries. That is a good idea.
  We are looking at countries that are fairly undeveloped or newly 
developed, certainly a different economy than we have here. Yet we want 
to strengthen those. I think over time, in terms of thinking about 
trade, it is going to be important that this hemisphere be together and 
be strong as we see things develop in Asia and other places around the 
world. So it is important that we do this.
  We are the largest Nation of purchases in the world. So we have some 
strength to bargain and even though we need to be fair about it, we 
need to exercise that muscle a little bit because we are in a position 
to do that. So it is a matter of coming up, hopefully, with fair trade 
and equality as much for everyone as we possibly can. It is not just a 
matter of helping others.
  There are other ways to help others. It is not just a matter of 
strengthening

[[Page 15032]]

other countries but having a relationship that is fair.
  I mentioned sugar. Sugar is not the biggest industry in the world, 
but it is an industry that is important to this country. It is an 
integral part of our economy. It is a little unique. Agriculture is a 
big thing in Wyoming, of course; mostly livestock, as one might 
imagine, in the open space and so on. In our agricultural economy, 
livestock produces the most by a great deal. The second actually is hay 
and feed for livestock, but third in crops is sugar. So it is a 
relatively large one for us.
  Sugar is unique as a commodity. If one raises oats and something 
happens to the price, they can raise barley or some other kind of 
grain. That is not the case with sugar. With sugar, there is a high 
investment in particular equipment such as thinning equipment. They 
used to use Mexican workers mostly to go out with a hoe and thin sugar 
beets. Well, they do not do that so much anymore. They use expensive 
equipment to do it. So it is a little different.
  The second thing that is different about it is that the producers now 
also are owners of the processing equipment. So in our State where we 
have relatively little manufacturing, we have some sugar processing 
plants which are unique. It is about the only agricultural product in 
our State that is processed to the extent it is ready for the grocery 
store shelf when it leaves our State. So even though, as the New York 
Times, I think, erroneously reported that it was not very important, 
there are lots of people hired in that industry who are not farmers, 
but they are producers. So it is unique and it has been treated 
uniquely over time in the farm bill and other places.
  So as one bargains into a trade agreement it is one of the things 
that one really does not have much flexibility to work on.
  Now, in regards to CAFTA, it is important that we deal with our 
neighbors in that part of the world. We need to work to have a 
relationship there. They need to strengthen their economy. There is no 
question about that. That is a good thing. But it is a relatively small 
market, about half of what some of the larger cities would be in the 
United States. So we do need to work at it, but we need to understand 
that it is not going to change the world in terms of what we are doing.
  We have made some efforts to make it work, and I am willing to say to 
my friends and others that several of us who are particularly 
interested in this have worked with the sugar beet and sugar cane 
growers over the country and have had a number of meetings with them, 
have listened to their issues and have worked with them before. We have 
also worked very closely with the Secretary of Agriculture, and I want 
to commend him for his efforts to try to find some arrangements that 
could make it better. We did, finally.
  However, one of the strange things about this is that this trade 
agreement was signed about a year ago and was not brought up to the 
floor until last week. So when we heard it was coming, I think, a week 
ago today, we had the very first meeting with the Secretary, with some 
congressional members who were interested, and the sugar people. There 
was a great deal of discussion, as there should be, but no one was 
prepared to make decisions in that short time. So we tried to get back 
together again, work some over the weekend and be back again on Monday. 
Lo and behold, here comes the bill to the Finance Committee, of which I 
am a member, before we even had our second meeting.
  I tried to suggest we need a little more time and maybe we could work 
something out. Nevertheless, that is where it was. Part of our problem 
was we have not had much time. I do again want to say the Secretary 
came in with some ideas. He still has some ideas and they are good 
ones. Our new trade ambassador, Rob Portman, is doing a great job. He 
has done everything he could possibly do to make this workable. Of 
course, he had nothing to do with negotiating it in the first place, 
but nevertheless both of those gentlemen have worked at it very hard. 
There has not been time to do something.
  The problem basically is that this sugar program has been one over 
time that has been kind of measured in trying to hold its production to 
the demand in the country. Currently, for example, there is lots of 
sugar being stored in Wyoming because production is over demand and our 
own sugar is not being put on the market because there is not enough 
capacity for it now.
  So the Secretary did agree that he could do some things until the 
next farm bill comes up, which is 2 years from now, and I think he can. 
He may have to use some CCC activities, exchange of one goods for 
another, to handle a relatively small amount of sugar that could come 
under this pact. The problem is, with the sugar people and others, that 
it is simply about a 2-year remedy. They need to look at something much 
further than that down the road.
  I say to my colleagues, it is not just exactly the CAFTA agreement 
that is of concern to us. It is also the fact that the NAFTA deal with 
Mexico will expire in 2 years, presumably opening up the market there 
not only for sugar but fructose and other things that could come here 
and could have a real impact on this fairly difficult to manage sugar 
industry in our country. So we have to keep in mind we are not just 
talking about CAFTA, we are talking about the impact that can come from 
the changes that take place in NAFTA as well.
  In addition, if we do something with CAFTA--and we are--then the next 
thing we are going to be looking at is other countries in Central 
America, Ecuador, and Brazil--finally, Brazil, which is a big sugar 
producer. So the precedent that is set with respect to sugar is one 
that is very concerning to the sugar industry.
  What are we going to do in the next immediate trade agreements? So 
these things all go into it, and that is why a 2-year solution--even 
though I really respect the fact that they tried to do something, we 
still will work at it. We are not through trying to find a remedy, but 
it apparently cannot fit into this. So I do, again, want to 
respectfully thank them for what they have done.
  In any event, those are some of the problems that we have. Finally, 
one other point, and that is that there seems to be, to me at least, a 
little lesson in this in terms of negotiating trade contracts. The 
authority to do that comes from the Congress, asked for by the 
Executive. As this is done, it seems to me we ought to have a little 
more input into it before it is resolved.
  What really happens in this case, at least practically, is that the 
negotiators go on, and when their negotiation is finished they come to 
us with a package over which in this case, because some of the 
countries had already agreed to it, there really was not any 
opportunity for changes in it when it came here. So I think we ought to 
have more input. We could deal with this.
  Two more points. One is how important this is. I got calls from the 
Secretary of Defense, from the Secretary of State, the President, and 
the Vice President talking about not only is the trade aspect important 
but also the relationships. I do not disagree with that, but I also 
have to say that I met with the six Presidents on this and they said 
the same thing, that this is more than just trade. I say to them and to 
myself, Why do we let this relatively little thing hold it up? Why did 
we not fix that knowing it was going to be a problem before we got 
there?
  I think we can do a better job in the future. I think we are going to 
be faced with some more of these kinds of issues. We ought to be able 
to deal with them.
  I am sorry we didn't have more time to perhaps come up with a remedy 
before we have to vote. I voted against it the second time in the 
committee. Unfortunately, I cannot support it this time. But I do hope 
we can make some changes and deal with it in the future.
  I yield the floor.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that subsequent to 
the remarks of the Senator from North Dakota, Mr. Conrad, pursuant to 
the

[[Page 15033]]

existing agreement, Senator McCain be recognized to speak for 10 
minutes and that time be taken from the time allocated to Senator 
Grassley; following Senator McCain, that Senator Dayton be recognized 
for 15 minutes and that time to be taken from the time allocated to 
myself.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from North Dakota.
  Mr. CONRAD. Mr. President, I thank the ranking member of the Finance 
Committee, Senator Baucus of Montana, for his leadership on this issue 
and for the outstanding work he does on the Finance Committee. I 
sometimes wonder if Senator Baucus ever gets any sleep at night, given 
the number of things on his plate.
  I thank my colleague from Wyoming, Senator Thomas, who has been a 
great ally in an attempt to protect an American industry from unfair 
provisions that will decimate an industry that employs 146,000 people 
in this country. Senator Thomas has truly been a great advocate for the 
people he represents on this issue. I very much appreciate working with 
him.
  I support free trade that opens markets and benefits American 
farmers, businesses, and workers. I supported the Uruguay Round WTO 
agreement. I supported PNTR for China. I supported the Chile agreement, 
the Singapore agreement, and the Morocco agreement. I did so because I 
believed those deals would benefit America and the people I represent 
in North Dakota. But I have come to the conclusion that our trade 
policy is not working. It is not a free trade policy. It is not a fair 
trade policy. Increasingly, it is a failed trade policy. This trade 
policy is clearly off track.
  I am beginning to wonder what are we thinking about in this town when 
we look at the results of the trade policy followed by Republican and 
Democratic administrations for an extended period of time. Here are the 
results of this trade policy that is supposed to be such a great 
success.
  This chart shows the trade deficit year by year, going back to 1992. 
Up, up, and away it goes. The trade deficit now totals $617 billion in 
2004. For a very long time we never had a trade deficit above $100 
billion in a year. Now we are over $600 billion, and the latest numbers 
show we are headed for $700 billion.
  Colleagues, how can anybody call this a success? If this is a 
success, what would be a failure?
  We keep signing these agreements that are supposed to benefit the 
country and our position keeps getting worse. In the 10 years since the 
North American Free Trade Agreement took effect, a period in which we 
adopted the WTO agreement, China PNTR, free-trade agreements with 
Chile, Singapore, Morocco, and Australia, our trade deficits have 
exploded.
  Up until 10 years ago, our annual trade deficit had never exceeded 
$100 billion. When we look at these individual agreements, we see the 
same story. Our trade agreement with Canada is one I opposed because I 
thought it would be injurious to my State, and indeed it has been. When 
we passed the Canadian agreement, we had a $9 billion deficit with 
Canada in trade. After the great success of the Canadian Free Trade 
Agreement, is the deficit less or is it more? Those who say more are 
right--not just a little bit more but a lot more. The trade deficit 
with Canada now is not the $9 billion we had when we entered into the 
agreement. Now it is $66 billion.
  The same is true with Mexico. On Mexico, remember we were told what a 
great opportunity this was going to be. If we just signed up to it, our 
trade relationship would flourish. At the time we entered into the 
agreement, we had a $2 billion trade surplus with Mexico. Let's go back 
and check the records. What is it now? Do we still have a trade surplus 
with Mexico? No. Instead, we have a massive and growing deficit. We 
went from a $2 billion trade surplus with Mexico to a $45 billion trade 
deficit. And the very people who negotiated that agreement are now 
going all over town telling us that this next one is another great 
success.
  I told them it reminds me a little of the German general in World War 
II who said that he knew things were going bad for Germany when the 
victories kept getting reported closer to Berlin. They had one great 
victory after another, but the victories were all getting closer to 
Berlin, as our forces approached.
  You know, I look at these great successes. My question is: How many 
more of these great successes can we afford? What are we doing with 
these rapidly growing trade deficits that mean we are borrowing 
hundreds of billions of dollars all over the world--over $600 billion 
from Japan, over $200 billion from China? We have even borrowed tens of 
billions of dollars from South Korea. Does anybody think that makes our 
country stronger? I don't. I think it makes us weaker, more vulnerable.
  What are we doing about it? We are not taking action to get China to 
stop manipulating its currency or stealing our intellectual property. 
That is not being done. We are not making progress to reopen the 
Japanese and Korean beef markets. That is not being done. We have not 
put a stop to Airbus's unfair subsidies. That is not being done. We 
have not put a stop to Mexico's unfair tax on beverages sweetened with 
corn. That is not being done. We have not put a stop to Canada's unfair 
softwood lumber subsidies. That is not being done.
  We have lost focus in these WTO talks, allowing them to drift in the 
wrong direction. Instead, the focus is on CAFTA. I love these CAFTA 
countries. They are wonderful people. But the combined economic impact 
of these countries is equivalent to Columbus, OH. This is our priority 
when we have a trade deficit of this magnitude? What earthly sense does 
this make?
  When I look at this agreement--I am on the Finance Committee. I have 
listened, at length, to our ambassadors and our negotiators, for whom I 
have high regard. They are wonderful people. But they have come back 
with a lousy agreement. They have gone all over America telling people 
this is a great opportunity for the United States. They say 80 percent 
of Central American goods come tariff free into the United States, yet 
we face tariff barriers when we export to their countries.
  OK, I understand that. It sounds logical and reasonable that this 
might be a good opportunity for us, if 80 percent of their goods come 
into our country tariff free, but our goods face tariff barriers going 
into their countries that would look like an opportunity. So when you 
analyze it, I assumed this would mean great progress with respect to 
trade deficits. Here is the report from our own International Trade 
Commission. This is not the U.N.'s trade commission. This isn't the 
CAFTA countries' trade commission. This is our own trade commission.
  On this chart is the conclusion they come to. That is what happens to 
imports, to our imports from the CAFTA countries. This is what happens 
to our exports. The import number is bigger than the export number. In 
other words, our trade deficit with the region is getting bigger--and 
they call this a success, when we already have record trade deficits? 
This negotiating team goes down there, spends years and comes back and 
says: Boy, have we done a great job. We have gotten an agreement that 
increases the trade deficit with the region.
  Hello. Is anybody paying attention? Not only does it make the trade 
deficit with the region worse, here is what the International Trade 
Commission says it will do for our economy.
  After listening to these speeches, listening to this testimony about 
how this is a great opportunity for America, I assumed that when they 
did the analysis of what it would mean for our economy, there would be 
a big plus. Guess what. Here is what the International Trade Commission 
found in their report. This is not my report. This is our own 
International Trade Commission report. They are the body that is 
responsible for scorekeeping on these agreements. Here is what they 
concluded. Here is what it would add to the gross domestic product of 
the United States. I don't know if they can see that on television--
that is a zero. Any gain is so modest it doesn't even show up: Zero.

[[Page 15034]]

  Zero is a very low number. That is what this agreement would do for 
the U.S. economy, according to our own International Trade Commission--
zero.
  But you know what, it also poses a very big risk, at least to one 
industry in this country. The industry that it puts at risk is the 
domestic sugar industry. The domestic sugar industry employs 146,000 
people in this country. Apparently, our negotiators decided to just 
negotiate that industry away. It is a $7 billion industry in the United 
States; a $2 billion industry in the Red River Valley of North Dakota 
and Minnesota. These trade negotiators who brought back a plan that 
worsens the trade deficit with the region--that according to our own 
scorekeepers adds nothing to the economy of the United States, adds 
zero percent to the GDP--puts at risk an entire industry. It is no 
wonder that our country is in trouble. It is no wonder that we are 
running record trade deficits. It is no wonder that those record trade 
deficits are getting even worse with a trade policy like this one.
  For months, the USTR has been telling us: Don't worry. This is going 
to be a little trickle of sugar that is going to come in here. You 
don't have to worry. It will be equivalent to a teaspoon. I wish it 
were true. It is a glib description and characterization of what it 
will do. The fact is, this would threaten an entire industry. Why? 
Because, under this agreement, it would permit 109,000 metric tons of 
additional sugar to come in. But that is not the only agreement that is 
being negotiated. If that same precedent would apply to the agreements 
with South Africa, Thailand, and the Andean countries that are being 
negotiated, you can see that would put us at over 500,000 tons of sugar 
coming into this country, over and above what comes in now.
  Every economist has said another 500,000 tons of sugar coming into 
this country would collapse the price of sugar below the redemption 
price, would unravel the sugar program and destroy the domestic sugar 
industry.
  That does not end the story. It is not just the agreements with South 
Africa, Thailand, and the Andean countries that are a problem, it is 
the previous agreement already entered into with Mexico under NAFTA.
  For months, USDA has been saying we can absorb the CAFTA amount of 
sugar because there is a cushion between our WTO import obligations and 
the farm bill trigger in the sugar program. But that cushion assumed 
Mexico would not export significant amounts of sugar to the United 
States. Guess what. That assumption was wrong. It is just not true. 
USDA just revised its Mexican sugar projections, and Mexico now is 
projected to have net surplus production of over 440,000 tons. That 
means under the NAFTA agreement, Mexico can send us another 250,000 
tons of sugar duty free, completely eliminating the so-called cushion.
  But it gets worse, much worse. Mexico's total exportable surplus this 
year is now projected to be more than 900,000 metric tons. So they can 
send us 250,000 duty free. But the story does not stop there. On top of 
that, they can bring sugar in under what is called Tier 2, where they 
pay a modest tariff, a tariff that makes it completely in their 
interest to pay the small tariff on that second tier and bring in the 
sugar. That means another 650,000 metric tons of sugar above and beyond 
the 250,000 tons of duty free sugar. Put it all together, and over 
1.151 metric tons of sugar comes into this country.
  The point is this: When we put together the treaties being negotiated 
and we put together what USDA has just said will be the capability of 
Mexico to send sugar into this country, we are way above the amount of 
sugar that would collapse the sugar industry in this country.
  There has been a side deal offered to the sugar industry. I will talk 
for just a minute about that deal. I have three words for those who 
think the deal might solve the problems I just described: Don't be 
fooled. That is not a deal, it is a figleaf. Here is why. The Secretary 
of Agriculture has suggested to certain Members of Congress that he 
intends to limit sugar import to 1.53 million tons. He says that will 
ensure the farm bill provision that turns off marketing allotments will 
not be triggered.
  Unfortunately, it does not work. Why not? First, the deal is only 
good for 2 years. Second, it does not address the next farm bill or 
other trade agreements that are under negotiation or what happens in 
2008 when the NAFTA sugar protections are gone. In fact, the way this 
is structured, it almost guarantees that any additional access in 
future agreements will be backloaded into 2008.
  My colleagues, that creates the potential for a perfect storm that 
will leave the market badly oversupplied going into the next farm bill. 
Despite highly unpopular payments to foreigners to keep them from 
sending us sugar--what an idea that is. Want to start paying countries 
not to send us stuff? Are we really going to do that? How long will 
that last? How long will it last, that we pay countries not to send us 
stuff? It will make it virtually impossible to retain the program in 
its current form and threaten the existence of an entire industry in 
this country that employs 146,000 people.
  I would be remiss if I did not make brief mention of the process that 
has gotten us to this point--fast track. Fast track prevents Senators 
from having the right to amend. Instead, we conduct what is called a 
mock markup in the Finance Committee and in the Ways and Means 
Committee in the House. We are supposed to be able to offer amendments 
there that would change the contour and the direction of an 
implementing bill as part of the Congress's constitutional 
responsibility for foreign commerce. But it turns out amendments in the 
Finance Committee mean nothing.
  Last year, when we considered the agreement with Australia, the 
Finance Committee set the precedent that if an amendment was adopted in 
the so-called mock markup and a majority of the committee rejected the 
proposed implementing bill, the committee action could be ignored. I 
got an amendment passed in the committee. It meant nothing.
  This year, with the Wyden amendment, the committee has set the 
precedent that when an amendment is adopted by the committee and the 
underlying proposed implementing bill is then approved by the 
committee, that amendment, too, can be ignored. So now we have a 
situation where this mock markup is a total mockery. It means nothing.
  What has happened is Senators have given up their right to amend, and 
they are left with nothing except the opportunity for a straight up-or-
down vote on the whole agreement. There is no opportunity to change the 
bill in committee or in the Senate. There is no other legislation that 
moves through this Senate that can be dealt with in that way. That is 
not how the process is supposed to work.
  In conclusion, CAFTA is the wrong agreement at the wrong time. It has 
been pushed through a process that in itself is wrong. It adds $100 
million to our trade deficit with the region, it puts a $7 billion 
industry at risk, creates the likelihood of increased illegal 
immigration, and it provides immeasurably small benefits for the 
economy as a whole. It does not make much sense to me.
  Here we have record trade deficits, the biggest they have ever been--
and growing--and our negotiators go out and reach an agreement that 
makes the trade deficit with the region in question worse and threatens 
an entire industry. They call it a success. Colleagues, I don't know 
how many more of these successes we can afford.
  I yield the floor.
  The PRESIDING OFFICER. Under the previous order, the Senator from 
Arizona is recognized for 10 minutes.
  Mr. McCAIN. Mr. President, I will respond.
  Mr. BAUCUS. Does the Senator want more time? We can certainly find 
it.
  Mr. McCAIN. I may ask for an additional 5.
  Mr. BAUCUS. I make that request.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCAIN. I thank my friend from Montana.

[[Page 15035]]

  The Senator from North Dakota just stated, Who pays? I wonder, who 
pays when my wife goes to the supermarket and pays 13 cents more for a 
pound of sugar than she does and would if we had sugar from these 
countries able to come into this country?
  I am not in the business of producing or selling sugar, nor are many 
American families. But there are a whole lot of American families who 
are in the business of buying products that have sugar in them. They 
pay an exorbitantly higher price because of the protectionism that is 
practiced for the sugar industry. Since when can't the United States 
compete on a level playing field?
  The opposition to this is clearly one that is protectionist in 
nature--for an industry that, in my view, should be able to compete 
with foreign producers. That is not what this debate really should be 
all about.
  The stakes could hardly be higher--whether we import or export sugar, 
whether the Central American Free Trade Agreement passes has 
implications, whether the American farm exports will enter the 
Dominican Republic duty free, or whether Guatemala will be able to 
increase its textile protection.
  By the way, I say to the Presiding Officer, if Guatemala is unable to 
export its textiles into the United States, I don't believe it will be 
the United States that would be producing textiles; I believe it will 
be the Chinese and others.
  I don't want to be hyperbolic, but I believe the vote we will soon 
take on CAFTA is one of the most important that will be cast in the 
Senate this year. It is important because at stake is the future of 
Central America in its economic and political dimensions and, hence, 
its security dimensions. It is important because it will determine 
whether the free-trade agenda as laid out by President Bush proceeds 
toward a successful Doha round of global trade talks or whether the 
effort will be stopped in its tracks. It is important because it will 
help determine whether the invigorating effects of free trade are 
experienced in our country anew or whether the protectionists are able 
to erect their walls around us. It is important because it will show 
whether a trade policy in America is determined by sugar growers, 
unions, and other special interests or whether it is determined by 
leaders who place at the forefront the interests of our Nation as a 
whole.
  A few years ago, we concluded a free-trade agreement with Chile. 
There are certain facts that are available already. There were the 
usual arguments against it from the protectionists. In 2004, the first 
year the agreement was effective, two-way trade increased by 33 
percent. In the first 4 months of this year, it grew even faster--45 
percent. Exports from the United States to Chile have risen at still 
higher rates--nearly 35 percent in 2004 and almost 63 percent in the 
first quarter of this year. Preliminary numbers suggest that in 2005, 
U.S. exports to Chile may nearly double those recorded in 2003. That is 
what free trade is all about. That is based on the firm conviction that 
most of us have that American products can compete with any in the 
world.
  Now, some can't. And that is terrible, and that is why we have trade 
adjustment assistance. When industries in the United States are 
directly affected by importation of products from other countries as a 
result of trade agreements, we have trade adjustment assistance to 
provide workers retraining to upgrade their ability to find other 
employment. We need to do more in that area. But to somehow reject the 
benefits of free trade because of the damage it may do--and I emphasize 
``may''--to certain industries is very shortsighted.
  We see in Latin America today a growing skepticism about democracy--
equated in the minds of many with austerity programs and lack of 
improvement in the standard of living. Disturbing polls suggest that 
discontent with democracy is on the rise and that large percentages 
would prefer a strong man who could improve living standards to a 
democratically elected leader who could not. CAFTA has the potential to 
illustrate the tangible benefits that come from democracy--free market 
economics and partnership with the United States.
  Let me give one concrete example. The apparel industry is critical in 
the regional economy, accounting for $9 billion in exports each year. 
CAFTA will lift duty on most apparel and nonapparel goods, immediately 
bolstering an economic sector that represents tens of thousands of jobs 
in the region. The overall effect of this and other benefits would be 
to help lock in Central America's political and economic gains.
  Let's consider what happens if CAFTA fails. Rejecting the pact would 
be seen by our Central American partners as American disengagement from 
a region important to our security. Thousands of apparel production 
jobs would likely be lost as they move production facilities from 
Central America to China, further exacerbating illegal immigration to 
the United States. It would signal to the people of Central America 
that the support of the United States for their freedom and prosperity 
is more rhetorical than real--even in a win-win situation for both 
sides. It would have a devastating effect on our effort to lower trade 
barriers with other partners around the world and to push forward the 
Doha round of multilateral talks and put another notch in the post of 
the special interests as they despoil the public good for their private 
gain.
  We need CAFTA. It is important to our economy. But it is also vital 
to our political security and humanitarian interests in Central 
America.
  The former President of Costa Rica, a Nobel Peace Prize winner, Oscar 
Arias, speaking of CAFTA, said it represents ``an unparalleled 
opportunity to transform Central America into a dynamic economy, deeply 
integrated with worldwide flows of trade and technology. We ask not for 
charity, but enlightened self-interest from our northern neighbor.''
  I am concerned about the state of democracy in Central America. I am 
disturbed that in Nicaragua there is every likelihood we may see Daniel 
Ortega as the next President of that country. I am disturbed about the 
failing economy and corruption that exists in El Salvador. I am 
concerned about the continuing stagnation of the economies of Guatemala 
and Honduras.
  Mr. President, if the countries of Central America continue to fail 
economically, it will give rise to a situation that I do not want to 
revisit. When I first came to the Senate, one of the overriding and 
compelling challenges we faced was the rise of communism in Central 
America, the influence of Castro in countries such as Nicaragua, the 
Sandinistas in power, the effect it had on neighboring countries such 
as Honduras and El Salvador where there was an ongoing revolution. 
Billions of dollars of American taxpayers' dollars were poured into the 
region in aiding El Salvador in combating others in the region.
  One of the most emotional and unpleasant debates I have ever engaged 
in on the floor of this Senate had to do with aid to the Contras. I do 
not want to revisit those days of the 1980s. I do not want to go back 
to a region that may be beset by corruption, anarchy, and possible 
insurgencies.
  We have another individual on the rise in our hemisphere, and his 
name is Chavez from Venezuela. He espouses policies and programs that I 
believe are not in the best interests of the people of Venezuela. And 
he also, I believe, is having an influence in the region. If there is 
anything we need today, it is strong, viable economies in Central 
America, so they can progress, so they can be strong, and they can 
again be allies of the United States of America, not in a military 
fashion but in their advocacy for free and open societies, democracies, 
and places where people can raise their families in a situation of 
security and peace.
  I would like to mention again, if there is one lesson we have learned 
in the challenge of illegal immigration in this country, it is that if 
people cannot feed themselves and their families where they are, they 
will go to places where they think they can. If that

[[Page 15036]]

means risking their lives crossing the Arizona-Sonora border, they will 
do so.
  Mr. President, I strongly urge--I strongly urge--my colleagues to not 
only understand the trade implications of this agreement but the 
political, social, as well as economic reasons for us to consider 
favorably this agreement. The stakes are very high. I believe, with the 
leadership of this President and the bipartisan support of this body, 
we will prevail.
  I thank my colleague from Montana for allowing me this time. I yield 
back the remaining time.
  The PRESIDING OFFICER (Mr. Burr). The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the following 
Senators be recognized next to speak after Senator Dayton: Senator 
Kerry for 15 minutes, with the time taken from the time allocated to 
me; and then a Republican Senator not yet named, for 10 minutes, with 
the time taken from the time allocated to Senator Grassley.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Under the previous order, the Senator from Minnesota is recognized 
for 15 minutes.
  Mr. DAYTON. Mr. President, I thank my distinguished colleague, the 
leader of our representation on the Senate Finance Committee, the 
Senator from Montana, who has been outstanding in his guidance to all 
of us in our caucus and in standing up for the interests not only of 
his own State but for the farmers and the workers and the people of 
Minnesota and America, as well as Montana. I thank him and I thank my 
colleagues from North Dakota who also have been in the forefront of 
this issue because they, like myself, represent people who are 
seriously at risk with this agreement.


                   Tribute To The U.S. Capitol Police

  Mr. President, before I address DR-CAFTA, I would like to take a 
moment to pay tribute to the courageous men and women of the U.S. 
Capitol Police, who risked their lives yesterday, once again, to help 
evacuate the rest of us safely from the Capitol Complex.
  This is, unfortunately, my fifth evacuation from the Capitol Complex, 
beginning with September 11, 2001. This has been the best of them, if 
such a word can be applied to that race against time and the possible 
horror that is involved.
  But as my staff and I walked out of the Russell Senate Office 
Building's nearest door yesterday afternoon, which is directly across 
the street from the Capitol, and hurried down the street away from the 
Capitol and the buildings, I saw several Capitol Police officers who 
stood directly exposed while they were calmly directing everyone else 
to safety. Other officers, I am told, remained once again at their 
posts inside or right outside the Capitol Building itself, helping 
everyone else to exit as quickly and safely as possible.
  Had the plane yesterday been a hijacked jetliner, as it was on 9/11, 
it would--if it had not been shot down--have struck its target within 2 
minutes of that evacuation alarm. It is questionable whether the 
evacuation of everyone in this complex would have been completed by 
then. But it is almost certain that the Capitol Police officers--who 
were doing their jobs heroically--would have still been at those posts, 
or very close to them, at that time. They kept themselves exposed to 
mortal danger to help their fellow citizens escape it. To all of them 
and to the other Senate staff who were involved, I say a heartfelt 
thank you.
  It is unfortunate, Mr. President, that exceptional virtue--to place 
the best interests of other Americans ahead of one's own--does not 
apply to this trade agreement called DR-CAFTA. It is a wolf in sheep's 
clothing. It pretends to help American workers and American farmers, to 
provide net gains to our domestic economic and employment growth, and 
also to benefit the people in six neighboring countries, when, in fact, 
its driving motivations are higher corporate profits and capital gains 
by shifting American jobs and their production to those nearby 
countries to exploit their low wages, scarce benefits, nonexistent 
protections for workers, environments, local economies, and lower 
transportation distances and costs than in China, India, Vietnam, and 
other places, to increase corporate profits and personal wealth at the 
expense of other Americans and our national economic health.
  This is the era of un-American capitalism, with great riches and no 
taxes for the richest Americans and lost jobs, lower incomes, and less 
financial security for the rest of Americans.
  Those are the facts from a decade of NAFTA, the unfortunate, 
unpleasant but actual real-world economic, employment, and trade facts 
resulting from 10 years of the North American Free Trade Agreement.
  As with DR-CAFTA now, NAFTA's proponents prior to its enactment 
peddled lots of wonderful promises and projections: that NAFTA would 
create big economic gains for every country and almost everyone in 
them; there would be increases in U.S. exports to NAFTA countries that 
would exceed the increased imports from them; and that net gain would 
increase domestic employment, domestic production, and domestic 
prosperity.
  They turned out to be, unfortunately, domestic dilutions. The real 
net effects from NAFTA have been exactly the opposite of those 
promotional fantasies. Over the last 10 years, U.S. imports from Mexico 
and Canada have increased by 10 times more than our exports to them, 
resulting in huge net losses, estimated to have cost over 900,000 
American jobs.
  Many of them have been good-paying jobs, benefit-providing, company-
pension-offering and previously secure, reliable, lifetime jobs, the 
kind of jobs that create stable, secure, healthy, and prosperous 
communities all across America, throughout all of our 50 States--the 
jobs that were the economic engines and the social foundations for the 
hard-working, productive, and successful people who had those jobs for 
their families, who were--and still are--themselves the greatness of 
America.
  But those ingredients of America's greatness--those jobs that support 
families, provide security, provide health benefits, provide pensions, 
allow Americans to earn the American dream--they are being dissipated, 
outsourced, traded away for immediate profits and financial gains for a 
few, at the expense of many more dislocated workers, destructed 
families, damaged communities, destitute seniors, and deficit-plagued 
local, State, and Federal governments, with serious trade imbalances 
that are increasing private and public debt, and having a weaker 
national economy with even more serious consequences ahead.
  The proponents of these free-trade agreements--and they are on both 
sides of the aisle, and they come from the preceding administrations as 
well as this one--remind me of the story of the crew that was blazing a 
road in the jungle. After quite a bit of work, the foreman sent 
somebody up to survey their progress. He climbed up to the top of the 
highest available tree and looked out and said: Stop, stop. We are 
going in the wrong direction. The foreman called back: But we can't 
stop now, we are making so much progress.
  These trade agreements have made progress but in the wrong direction. 
The proponents' solution to that predicament is more of the same--yet 
another trade agreement with the same bad effects for much of America. 
In fact, DR-CAFTA is the worst of NAFTA. It involves countries that 
have even lower standards of living than our own. The per capita 
income, the average citizen's income, in those six countries range from 
one-tenth of the U.S. per capita income to one one-hundredth of our per 
capita income.
  We are told, by those who want to pass this agreement, that it is 
going to create these great export opportunities for our own 
industries. But exports require people in those countries who can 
afford to buy what Americans produce. There will be a marginal 
increase, to be sure, if there is increased employment in those 
countries. That is positive. I hope--and we should hope--that any trade 
agreement we make will be good for our fellow world citizens.
  However, we should make our trade agreements for our own citizens 
first

[[Page 15037]]

and foremost, and not for anyone else's, because every other country in 
the world, every government in the world, whether capitalist, 
Socialist, or even Communist--if it is rational in its economic 
policies--makes trade agreements in its own national self-interest. And 
then they try to maximize the benefits to their country from those 
agreements. Unfortunately, we have seen other countries' governments 
far more effective, even within the scope of these previous trade 
agreements, at maximizing to their advantage, and often to our 
detriment, what they can gain from the exploitation of those 
agreements.
  Our trade policy should not be based on free trade or fair trade or 
any other kind of policy ideology or economic idolatry, as it has 
almost become, but on what is the best policy with the best economic 
results for the most Americans. By that measure, what is the broad 
public interest--after you take the winners and the losers, which in an 
enormous, complex, diverse economy such as our own, almost any trade 
agreement is going to have gains and losses--you have to look at the 
net effects, what is in the broad public interest, to decide what is 
best for America.
  The U.S. International Trade Commission--independent of all of us; 
tasked by law with developing the expertise to carry out these 
agreements and to analyze them and to analyze each of these proposed 
agreements in advance of our voting--has already concluded by its 
independent, expert analysis that under the DR-CAFTA agreement, as 
proposed, the U.S. trade deficit with those six nations will increase 
by an estimated $110 million per year.
  That is because the increases in their imports into the United States 
will be greater than the increases of our exports into those countries. 
That is the net balance. That is the bottom line. That is not, as some 
people say, one group's interests or another group's interests. That is 
America's best combined interest, and it is exactly the opposite of 
what proponents have been saying is going to be one of the benefits. 
Once again, the facts, based on the International Trade Commission's 
projections, but also consistent with the facts as we have seen from 10 
years' experience with NAFTA, do not support the Bush administration's 
false assurances and the claims of others who will benefit and are 
promoting this agreement.
  The response, one would hope, from the administration, in light of 
that projection by the International Trade Commission that came out 
about 6 months ago, would be to negotiate changes in the agreement so 
that we would come out as a net winner rather than a loser. But that 
has not been their response. It is to increase the advertising, 
increase the paid promotions for this proposed agreement by those who 
will benefit from it and by, reportedly--and I have heard this directly 
from some of those involved in the sugar industry who have been in 
direct negotiations with the administration--to threaten those who 
oppose the agreement because they perceive, correctly, that it will 
have serious negative consequences for their own livelihoods, for their 
own families, their friends, their neighbors, threaten them with 
reprisals in the future if they persist in their opposition, or to try 
to, as we are seeing now, buy them off with some special side deal.
  I don't hear anybody on either side of the argument, for or against 
CAFTA-DR, who disputes the projections by the experts and the industry 
itself that the American sugar industry--sugar beets in northwestern 
Minnesota and central Minnesota and neighboring States, sugar cane in 
other States--would be seriously and negatively affected.
  The extent is perhaps debatable, but the negative effects are 
indisputable, if CAFTA-DR is approved. So to tell them that they should 
sign off on their own economic death warrant, or they are going to 
suffer future reprisals for not doing so is wrong. It is unfair.
  The latest approach has been, well, we are going to offer you this 
special side deal for a couple years to buy you off. I don't know all 
the details. It has just been disclosed. I don't fault my colleague in 
the Senate from Minnesota who is purportedly instrumental in that 
negotiation. I don't agree. I strongly disagree with the arrangement, 
as I understand it. But I fault the administration for insisting that 
he or others try to work out such a deal. It is like being handed a 
huge lemon and being told to make lemonade. Unfortunately, with this 
trade agreement, there is not enough sugar in all of America to sweeten 
what is wrong with CAFTA, even for the sugar industry.
  The PRESIDING OFFICER. The time of the Senator has expired.
  Mr. DAYTON. I ask unanimous consent for 5 more minutes to complete my 
remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DAYTON. I thank the Chair.
  The proponents want this agreement so much that they are going to 
use--one way or another, directly or indirectly--U.S. taxpayer dollars 
to subsidize domestic sugar production or to buy off some of the 
otherwise imported sugar from these CAFTA countries at taxpayer expense 
in order to promote a free-trade agreement. It has the added irony, 
bitter irony of using tax dollars from working Americans in some cases 
to subsidize an agreement that is going to cost them their jobs. It 
underscores how the policy is bad economics, how it is bad trade 
policy. But the proponents of it want it so badly, because of its 
benefits for those companies that can outsource their jobs, based now 
in the United States, and that production to nearby countries, taking 
advantage of low wages there, costing American jobs, costing American 
communities their businesses and their employment and their social 
stability for the benefit of the wealthy few corporate interests who 
are bankrolling this effort, and now, in the ultimate bitter 
conclusion, taking taxpayer dollars to pay for the political grease to 
get this agreement through.
  If I really wanted to be Machiavellian in my thinking, I would say 
also--as a big proponent of the domestic ethanol industry, which is now 
just reaching, because of the world oil price, competitive parity, even 
without the public tax subsidy for ethanol, of price competitiveness, 
even a price advantage in my State of Minnesota with regular gasoline--
that by taking this, as some reports have said, excess sugar production 
and providing what will be an effective subsidy of an additional dollar 
for a gallon of the ethanol produced from it, distorting the economics, 
the competitiveness of ethanol, distorting the supply in the 
competitively growing, successful domestic ethanol industry and trying 
to show how--in this case, with sugar beets or sugar cane in this 
country--price uncompetitive making ethanol is from those products is 
poisoning the well, the public support, is going to reinforce those 
opponents of ethanol who will then say: Look at how uncompetitive it is 
and how outrageous this additional taxpayer subsidy is for the 
production of ethanol from it. And in this case they will be right. And 
they will use that, I believe, unfortunately, to try to poison the 
political and public well of support for ethanol, which is a very 
important, promising part of our energy independence and economic 
future.
  This is a bad agreement for America. It is bad for the sugar 
industry, and I oppose it for that reason. But even taking sugar aside, 
it is bad for the rest of America. It is bad for American workers, 
American industry. It is bad, as the International Trade Commission has 
concluded, on the basis of the bottom line--the trade imbalance 
increased, trade deficit with those countries increased, imports that 
will exceed the increase in our exports. That means, net result, it is 
bad policy, bad trade for America.
  I oppose it. I urge my colleagues to do the same.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Illinois.
  Mr. DURBIN. Mr. President, I ask unanimous consent that I be allowed 
to speak in place of Senator Kerry for 15 minutes, and that the next 
speaker after me be a Republican Senator

[[Page 15038]]

under the time Senator Grassley was previously granted.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DURBIN. Mr. President, I come to the floor today to announce my 
opposition to CAFTA. Some expect Democratic Senators to by and large 
oppose trade agreements and Republican Senators to support them. I come 
to this debate as a Democratic Senator who has supported trade 
agreements in the past. I supported NAFTA, permanent normal trade 
relations for China, trade agreements for Chile, Singapore, Morocco, 
and Australia. I think globalization is as inevitable as gravity. We 
have to accept the fact that America cannot be a rich and prosperous 
country by selling to ourselves. Merely doing one another's laundry 
will not create wealth and will not improve our standard of living. We 
need markets. That is why I have supported trade agreements in the 
past.
  I also understand that as you expand trade, there is pain and there 
is gain. We have seen it happen throughout the history of the world 
that as trade expands, some industries expand with it and others 
decline. When we Americans look at the course of history, we find 
strong evidence that joining together democracy and free markets is a 
winning combination. Expanding trade goes hand in hand with pushing the 
concepts of freedom, ingenuity, innovation, efficiency--all sorts of 
respect for people at every level. That is one of the reasons I have 
supported some trade agreements in the past. That is the very reason I 
oppose CAFTA.
  I am disappointed. If there is one casualty in CAFTA, that casualty 
would be the worker--not just the American worker but the workers in 
Central America. We know what is happening. We have seen over the past 
4 years that America has lost one out of every six manufacturing jobs 
in the last 4 years and few months. It hit my State pretty hard. 
Several hundred thousand manufacturing jobs in Illinois are gone, never 
to return. It is happening across America. The trade policy we have 
today is exporting jobs. How long can this continue?
  We would like to believe that we are going to educate and train a new 
group of American workers for the 21st century economy. We have to. But 
in the meantime, should we be entering into trade agreements that 
encourage the export of good-paying manufacturing jobs from the United 
States? Should we, instead, be saying that we are going to have trade 
agreements that make certain we aren't playing to the lowest level? If 
we have to compete with the countries that pay the lowest wages in the 
world, we will always lose.
  What are we going to say to American workers? Compete at a wage level 
the same as another country? If you do that, you know what is going to 
happen to the standard of living. How can you provide for your family? 
How can you expect to have health insurance? How can you put any money 
away for your retirement, when you play to that level? That is what 
this trade agreement does.
  Let me tell you two specifics. Senator Ron Wyden of the State of 
Oregon offered an amendment to this CAFTA agreement which said: If 
American workers in the service industries lose their jobs because of 
our decision to enact this trade agreement, we will help retrain them, 
give them new skills and education so they can go back to work. 
Displaced workers from service industries would have a fighting chance 
to get back on their feet and be able to compete. The amendment was 
rejected by the Bush administration, leaving these workers, who are the 
victims of CAFTA, high and dry. But there are other workers at stake 
here, too. I don't think it is unreasonable for us to ask, when a 
country says they want to trade with us, How do you treat your workers? 
Do you treat them with dignity? Do you give them a chance to bargain 
collectively for their future? Do you allow child labor? Do you allow 
slave labor? Why in the world would we want to get into a trade 
agreement with a country that is exporting goods to the United States 
because they exploit the very people who live in their country?
  The language in CAFTA is the weakest language I have ever seen in a 
trade agreement. It basically says to the Central American countries: 
Just play by your own rules, whatever they happen to be.
  That is not enough. It isn't as if we don't know what is coming. Our 
U.S. Department of Labor, under the Bush administration, ordered a 
study of the labor laws in the Central American countries that we are 
entering into this agreement with. That study came out and made the 
following report:

       In practice, labor laws on the books in Central America are 
     not sufficient to deter employers from violations, as actual 
     sanctions for violations of the law are weak or nonexistent.

  What does that mean? It means that if you hire children to make 
textile goods or whatever it happens to be, if you exploit these little 
kids in one of these countries, if you work people enormous hours 
without adequate compensation, if you stop them from organizing and 
bargaining collectively, the laws in Central America are not going to 
be there to protect those workers. Ordinarily we say: Life is different 
in other parts of the world. We shouldn't worry about it. These are the 
very workers who will make the products who will compete with America. 
That is what it comes down to. Are we going to continue to play to the 
lowest common denominator, that as long as businesses are profitable in 
their trade agreements, we don't want to know the details? That is what 
this trade agreement does.
  Under this administration, workers are expendable. They are 
expendable in the United States, and they are expendable in the 
countries that we are entering into agreements with.
  That is a sad reality.
  I know that there are going to be changes, and we have to accept 
economic change. But wouldn't we want to stand by American workers 
first and their families? We have done it in some other agreements--the 
Caribbean Basin Initiative and the Generalized System of Preferences. 
This agreement is one of the weakest I have ever seen when it comes to 
the rights of working people. In those countries in Central America, it 
is not uncommon to face blacklisting, violence, even assassination of 
union organizers. It goes largely unpunished. This agreement would not 
move us one step toward more civilized treatment of workers in those 
countries.
  If we truly care about the basic protections that are supposed to be 
behind a free-market economy and democracy, we ought to protect 
American workers first, not rush to the bottom when it comes to labor 
standards. We ought to enter into trade agreements where parties are 
not free to ignore labor standards and basic human rights. That is what 
is at stake.
  Since this President took office, we have lost 2.8 million 
manufacturing jobs--1 out of 6--and 140,000 in my home State in the 
last 4\1/2\ years. It is a tragic, dismal, and shameful record of 
American workers losing their opportunities. And this trade agreement, 
sadly, will only make it worse.
  Let me tell you about the group that, frankly, will prosper the most 
from this agreement. It will come as no surprise to you if you 
understand the political dynamics of Capitol Hill.
  Mr. President, how much time do I have remaining?
  The PRESIDING OFFICER. The Senator has 7\1/2\ minutes remaining.
  Mr. DURBIN. Please advise me when I have 2 minutes.
  One of the special interest groups with more power in Washington than 
any others is the pharmaceutical industry. We have seen it time and 
time again. When we go into a bill for Medicare prescription drug 
benefits, we say: Would you not want Medicare to bargain with the drug 
companies so seniors across America would pay lower prices? No way. It 
was kept out of the bill so that the pharmaceutical and drug companies 
can charge exorbitantly high prices to American citizens. That is why 
people are going to Canada, Mexico, and Europe trying to find cheaper 
drugs. It is because their Governments care, they force competition, 
they keep prices down. Not our Government. Along comes a trade

[[Page 15039]]

agreement. What could that have to do with the pharmaceutical companies 
and drug companies? There are roughly 165,000 people in the Central 
American nations living with HIV/AIDS. These are low-income countries 
where the people are struggling to survive and medicine is barely 
affordable.
  Doctors Without Borders--you may have heard of this fabulous 
organization based out of France, doing wonderful work all around the 
world. They provide drugs to HIV patients, and 1,600 in Guatemala 
alone. They rely on generic drugs because they cannot afford the most 
expensive drugs. They cost less than brand-named drugs. They can keep a 
person alive with HIV/AIDS in Guatemala for $216 a year. If they had to 
pay for the brand name, it would be $4,818. That is the difference--
more than 20 times the cost.
  I know these patents to drug companies are important. They help to 
spur innovation by rewarding companies for investing. We need a careful 
balance where we allow generic drugs in these Central American 
countries and not abuse the patents of the drug companies 
unnecessarily. At the global level, there has been an active debate 
about this very issue. We have had agreements that have been entered 
into. These agreements try to strike a careful balance between allowing 
more inexpensive drugs in the poor countries and still protect the 
patents.
  Sadly, this CAFTA agreement destroys the balance that has been 
entered into in previous agreements. This CAFTA trade agreement 
requires CAFTA countries to adopt provisions, such as keeping testing 
data for drugs secret for longer periods of time than even required in 
the United States of America. And without access to testing data, it 
becomes nearly impossible for new generic companies to break into the 
market and provide the drugs for these people in Central America, and 
some, of course, in our region.
  CAFTA will require countries to extend the lives of patents, under 
certain circumstances, for even longer periods of time than is 
permitted under U.S. law. This is a bonanza for pharmaceutical 
companies. They will make more money out of this agreement because we 
put their special interest provisions into this trade understanding. 
These provisions will apply to new drugs as they are developed, not 
existing generics.
  The long delays that CAFTA will impose means patients will have to 
wait even longer to get access to lifesaving treatment. I think when 
you look at this and you understand workers are losing, you have to 
understand as well that a lot of sick people with HIV/AIDS are going to 
lose, too. People are struggling to survive, and they will fall victim 
to the profit margins of American pharmaceutical companies. Those are 
the priorities--the priorities of CAFTA.
  Why aren't the American workers the priority of CAFTA? Why aren't the 
workers of Central America the priorities of CAFTA? Why is America's 
record of humanitarian care when it comes to using these drugs all 
around the world--why isn't that the priority?
  Let me speak about agriculture. I come from a strong agricultural 
State. I have promoted or stood behind many trade agreements in the 
past because it helped create agricultural markets. But CAFTA 
countries, Central American countries, have a combined population of 
about 31 million people who generally have limited incomes with which 
to purchase agricultural products. The market is worth about $1.6 
billion in annual agricultural exports. That is a large sum, but in the 
perspective of all of the exports we have, it is not overwhelming. Many 
key U.S. commodities already have open access to the Central American 
market. About 94 percent of all grains imported into the six CAFTA 
countries comes from the United States. This domination means there is 
little room for further upward growth when it comes to agriculture. So 
I think when we look at this, we have to ask a more important question: 
Think about the Central American country for a moment. Think about a 
subsistence farmer living in the countryside of one of these Central 
American countries who is growing grain.
  Assume it is corn for the moment. Think about the possibility that 
this trade agreement means that more and cheaper corn will come in from 
the United States to this Central American country. Think what happens 
to that poor farmer and his family if he can no longer eke out a living 
for himself and his family and sell enough to continue on, and he has 
to leave his farm--and it happens all the time--because of this 
agreement. Where does that peasant farmer go? His first stop is likely 
to be a large city in Central America, San Jose in Costa Rica, or some 
other city. Failing to find a job in that city, where is his next stop? 
El Norte, the United States.
  So as we assault the economies of Central America, without respect 
for their workers, without respect for their farmers, we create 
economic instability which moves families into cities first, and 
finally, in desperation, to anyplace they can go to find any job to 
survive. Now, there may be large companies that will make great profits 
out of CAFTA. But, sadly, they are not taking into consideration what 
it is going to mean to workers and to a lot of smaller companies in the 
United States that will not survive this trade agreement.
  If there was ever a time in our history when we should step back, as 
we face the largest trade deficit in the United States, as we see 
countries such as China around the world exploiting us because they are 
buying our debt--the largest national deficit in the history of the 
United States under the Bush administration--and understand that China 
and these countries will continue to exploit us on the trade side--
China manipulates its currency, and we don't do anything about it. We 
don't even talk about it. Because of that manipulation, they take away 
American jobs.
  This Senator has voted for trade agreements in the past. I will not 
vote for this one. If we are going to have trade agreements, there 
should be laws enforced on both sides, exporters and importers. Sadly, 
that has not been the case. This CAFTA agreement will hurt American 
workers, hurt the workers of Central America, be a bonanza for American 
pharmaceutical companies, and create instability in the United States.
  It could not come at a worse time. I look forward to voting against 
it.
  Mr. HATCH. Mr. President, I ask unanimous consent that the next 
Senator to be recognized be Senator Cornyn for 10 minutes from our 
time, and then Senator Kerry for 15 minutes from Senator Baucus's time, 
and then Senator Vitter for 10 minutes from Senator Grassley's time.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The Senator from Texas is recognized.
  Mr. CORNYN. Mr. President, I rise today to lend my voice and my 
support for the Dominican Republic-Central America-United States Free 
Trade Agreement. CAFTA would be a great benefit to the United States 
and all countries involved. Momentum continues to build for this 
important accord which will, notwithstanding what some have said on the 
floor today, actually grow jobs in the United States and grow jobs in 
Central America. It will boost opportunities for exporters in the 
United States and provide additional market access for our products in 
Central America. Congress should pass this important agreement for the 
good of both our economy and our national security, as well as those of 
our neighbors.
  Economic growth brought about by free trade and free markets creates 
new jobs and raises income. This growth lifts people out of poverty, 
even as it spurs positive economic development. Free trade supports 
sustainable development and strengthens private property rights while 
encouraging competition, transparency, regional integration, and the 
open flow of technology. And a strong world economy based upon free 
trade and transparency advances not only the prosperity of nations but 
the cause of peace and liberty around the world.
  A vibrant, free market that values innovation and competition is one 
of the vital components of American success. For consumers here in the 
United

[[Page 15040]]

States and the DR-CAFTA countries--Costa Rica, the Dominican Republic, 
El Salvador, Guatemala, Honduras, and Nicaragua--free-trade will 
provide real and tangible benefits. It will demonstrate our commitment 
to the economic prosperity of that region, and it will also encourage 
the spread of democracy, transparency, and respect for the rule of law.
  DR-CAFTA countries are our 12th largest export market, with nearly 44 
million consumers. Currently, nearly 80 percent of products from these 
countries enter the U.S. duty-free, but the average tariff on our goods 
is between 7 and 9 percent. DR-CAFTA would eliminate this imbalance and 
provide instead for reciprocal trade between all parties to the 
agreement--this means the playing field would be leveled for American 
exporters.
  The benefits of this agreement are clear: When CAFTA is implemented, 
80 percent of U.S. products will enter DR-CAFTA countries duty-free, 
with the remaining 20 percent being phased in over 10 years. Currently, 
the average tariff imposed on U.S. exports to Central America is 
between 7 and 9 percent--and some farm products being taxed as much as 
16 percent.
  Key U.S. export sectors stand to significantly benefit from the 
agreement, including medical and scientific equipment, information 
technology products, construction equipment, and paper products.
  As well, agriculture exports will be allowed to expand: More than 
half of current U.S. farm exports to Central America will become duty 
free immediately, including cotton, wheat, soybeans, fruits and 
vegetables, high-quality cuts of beef, processed food products, and 
wine. It is estimated that U.S. agriculture producers will increase 
their exports by $900 million as a result of the DR-CAFTA agreement. 
Finally, after tariff liberalization has been fully implemented, and 
all economic adjustments have occurred, overall U.S. welfare is likely 
to increase in the range of $135.31 million to $248.17 million. As 
well, the U.S. International Trade Commission has found that the effect 
of the agreement would be to reduce the overall U.S. trade deficit by 
$756 million.
  Furthermore, over half of current U.S. farm exports to Central 
America will become duty-free immediately, and other U.S. exports, such 
as information technology products, agricultural and construction 
equipment, paper products, chemicals, and medical and scientific 
equipment will immediately gain duty-free access.
  Workers in Central America and the Dominican Republic support the 
agreement. They recognize that it will help create more and better 
paying jobs. This in turn will help fight poverty, lifting these 
workers out of circumstances where they currently survive on only a few 
dollars a day. Enhanced opportunities for economic growth will provide 
these governments with additional resources for much-needed health 
care, education, and basic infrastructure.
  By working to alleviate poverty in Central America, we increase the 
likelihood that would-be immigrants would instead choose to stay and 
work in their own countries. We have seen the flow of immigrants who 
flock across our borders--they come here to work hard so they can send 
money home to support their families and relatives. They may be well-
intentioned, but these hard workers are doing little to help the 
economy of Central Amerixa.
  The young democracies of Central America still face resistance from 
those opposed to the spread of democracy and economic freedom. In 
supporting DR-CAFTA, the United States will stand alongside those who 
support these ideals--those who believe in the rule of law, and will 
demonstrate that America does not merely view Central America as a 
trading partner, but that we intend to support the continued democratic 
development of our neighbors.
  Congress should promptly pass DR-CAFTA, as agreements that remove 
unnecessary barriers to free markets are good for America, and it is in 
our economic and national security interests to support a prosperous 
Central America. DR-CAFTA will encourage economic prosperity, 
stability, transparency, and respect for the rule of law throughout the 
region. I ask that my colleagues join me in supporting this important 
agreement.
  Mr. President, let me focus, in the time I have remaining, on 
immigration. I heard the Senator from Illinois claim that if we pass 
CAFTA, it will somehow displace Central American workers and they will 
be caused to immigrate--illegally, perhaps--to the United States. I 
could not disagree with him more.
  About a year ago, I traveled to Central America to five of the 
countries involved in this agreement, and in each and every one of 
those Central American countries we were told that their new 
democracies' future depends on ratification of these free-trade 
agreements. To a man, the leaders of those countries asked us to do 
everything we can to see that this free-trade agreement passes.
  While certainly we want to be a friendly neighbor if we can, I would 
not support this agreement if it weren't in the best interests of the 
United States on a number of bases. There is one conversation I 
remember in particular that relates to the comments we just heard from 
the Senator from Illinois about immigration. In Guatemala, at the 
Ambassador's residence, a gentleman told me, ``We want to export goods 
and services, not people.''
  Mr. President, that stuck with me because what he was saying is that 
by our ratifying CAFTA, we create jobs and opportunities for the people 
of Central America where they live, so they don't have to come to the 
United States--illegally or otherwise--to be able to support their 
families. That is one of the reasons I am so strongly for this 
agreement.
  I am also for this agreement because these new democracies, many of 
which were engaged in civil war not that many years ago--and countries 
such as Nicaragua, where Daniel Ortega is hoping and praying that we 
will somehow turn our back on that country and these other new 
democracies--there are literally people waiting to take advantage of 
America if we turn our back on these countries, and to claim that 
instead we should align our interests with people like Fidel Castro, 
Daniel Ortega, and others.
  It is in our best interest to make sure that these new and fragile 
democracies flourish, that people who live there can also find work 
there and support their families. The irony is that we hear people 
argue that unless we have stronger labor provisions or environmental 
provisions for these agreements--this agreement in Central America--
that we somehow should not pass it. The fact is, there are strong labor 
provisions and environmental provisions in this agreement. But do you 
know what. The best guarantee for a good environment is democracy. The 
best guarantee for good labor laws and the rule of law in these 
countries is democracy.
  If we turn our backs on Central America and these countries in this 
free-trade agreement, critics and enemies of this country will point to 
us and our actions and our rejection of this agreement and claim 
victory and say that America was not serious about helping; America 
does not care about anyone but itself, when in fact the opposite is 
true.
  We know, further, that the avenues used for illegal immigration up 
from South America, Central America, through Mexico's southern border, 
through seaports, and in the air are being used by organized criminals 
who smuggle human beings, who traffic in persons, who smuggle weapons, 
and who smuggle illegal narcotics. In other words, they are organized 
criminals who care only about making money, and they don't care one 
whit about the human suffering that they cause.
  It is simply in America's self-interest that we enter into this 
agreement which provides new markets for our producers in this country. 
It opens our markets further to those fragile democracies and market 
economies in Central America. It gives democracy a root in a way that 
cements our interest and reinforces our national interest, not only in 
this country, but in this hemisphere in Central and South

[[Page 15041]]

America, an area that could sorely use the attention after what has 
been called a period of benign neglect.
  I urge my colleagues to vote with me in promptly passing CAFTA as 
agreements that remove unnecessary barriers to free markets which is in 
the economic and national security interest of the United States and a 
prosperous Central America.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I ask unanimous consent that Mr. Vitter be 
recognized for his 10 minutes, and then we will go immediately to the 
distinguished Senator from Massachusetts, Mr. Kerry.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Louisiana is recognized for 10 minutes.
  Mr. VITTER. Mr. President, I rise today in opposition to S. 1307, the 
bill to implement the Dominican Republic-Central America Free Trade 
Agreement. I do it for one very clear and specific reason. CAFTA will 
greatly harm Louisiana's sugarcane industry. It is, quite frankly, a 
raw deal for Louisiana sugar.
  Because of the great disruption in our domestic sugar market that 
this agreement would cause, I have been actively opposing this 
agreement since it was signed. This agreement would allow an additional 
122,000 tons of imported sugar into the United States in its first year 
alone, with annual increases following. These steady increases in 
imports threaten to flood the U.S. market and truly devastate the 
Louisiana sugarcane industry, as domestic sugar is displaced by highly 
subsidized foreign imports.
  Our current sugar program is designed to limit imports to help 
counter unfair trade actions, and these limits help mitigate the ill 
effects of dumping by other nations. Unlike programs for many other 
foreign commodities, it should be noted that this U.S. sugar program 
provides no cash payments and operates at no cost to the U.S. taxpayers 
through cash payments as mandated by the farm bill.
  Even with that existing program in import controls, the U.S. still 
stands as the fourth largest net sugar importer in the world, importing 
15 percent of our sugar consumption every year. Allowing more imports 
from select CAFTA trading partners truly brings a potential flood to 
the market, displacing even more domestic sugar. CAFTA really could set 
the stage for future bilateral agreements focused on the largest sugar-
producing nations, and these impacts are compounded with other pending 
changes, such as the NAFTA-mandated change that will allow Mexican 
sugar complete unfettered access to U.S. markets after 2008.
  When the Jesuit priests introduced sugarcane to Louisiana in the 
1750s, I guess they could not have imagined that sugar would 
essentially be a $2 billion industry and, much more importantly, even a 
vital part of Louisiana's history and way of life for over 250 years. 
It is this economic and even cultural impact and the thousands of 
families who rely on sugarcane for their livelihood and their way of 
life which lies behind my decision to oppose CAFTA.
  The Louisiana Farm Bureau estimates CAFTA would have caused an $8.5 
million reduction in Louisiana's agricultural sector, and sugarcane 
constitutes one of the foundations of this important sector of 
Louisiana's overall economy.
  Louisiana is home to 27,000 sugar industry jobs, 15 sugar mills, 2 
sugar refineries, and more than 580,000 acres of sugarcane throughout 
24 parishes. All told, Louisiana alone produces 20 percent of all of 
our domestic sugar.
  As I said, this represents an enormous economic impact. But even more 
importantly, it truly represents a culture and a valued way of life.
  The administration made a last-ditch, three-part proposal to the 
sugar industry to mitigate CAFTA's impact, but I truly believe that it 
is untenable.
  First, they committed to hold harmless the sugar program but only 
through the reauthorization of the 2002 farm bill. This is something 
modest, something I could and will support, but it is my understanding 
that it is already the responsibility of the Secretary of Agriculture, 
under this farm bill, to operate the program at no net cost and its 
import trigger.
  I know that sugarcane farmers in my State appreciate the Secretary's 
commitment to provide this short-term relief from a flood of sugar 
import commitments, but this temporary protection will not help them 
avoid the flood in the medium and long term. We, in Louisiana, know a 
lot about hurricanes and floods, and I fear that in the past 2 years, 
our sugar industries have drowned in this flood of foreign imports.
  The second component of the proposed deal from the administration is 
perhaps the most problematic. If imports threaten to exceed the 1.523-
million-ton trigger in the farm bill, the Agriculture Department would 
commit to compensating foreign producers for not selling their sugar 
within our market. U.S. tax dollars are going to compensate foreign 
producers. USDA would also establish a pilot program to divert imported 
sugar into ethanol use up to the amount coming in under CAFTA.
  The prospect of paying foreign producers is very troublesome, perhaps 
politically untenable. Regardless of the Secretary's statement that he 
has the authority to implement such a program, there are so many 
unanswered questions on how it would work and if it would be 
politically supportable. Do we really want to make cash payments to 
foreign governments or private foreign corporations in exchange for a 
commitment not to export sugar to our market? I don't think so. This 
proposal is expected to cost $200 million a year.
  Sending our tax dollars to our foreign competition I think is an 
untenable position for a variety of budgetary, policy, and political 
reasons, making this long-term proposed solution untenable.
  The ethanol diversion program has its own uncertainties on how it 
will work, and it seems to signal a desire to purchase foreign sugar 
for possible ethanol use instead of assisting the domestic industry in 
developing new markets for our own production and likely spend 
significant more of the taxpayers' dollars on those foreign sources in 
the process.
  Third, there has been a proposal for a feasibility study on 
converting sugar into ethanol to be submitted to Congress no later than 
July 1, 2006. We already know sugar can be turned into ethanol because 
they are doing just that in other countries.
  Worldwide, more ethanol is produced from sucrose than from corn, and 
we now need to jump start our own efforts and truly implement a program 
to provide sugar access to the national renewable fuels program.
  The Energy bill we passed this week provides for 8 billion gallons 
per year of renewable fuels, most of which will be ethanol. The new 
renewable fuels program would amount to more than quadruple the ethanol 
currently being consumed in the U.S. So there is plenty of room to 
accommodate diverse sources of ethanol, including a modest room for 
sugar.
  Access to ethanol was the crux of the sugar industry's proposal to 
deal with CAFTA--not a study, but real access to that established 
program moving forward in the Energy bill. They asked for a short-term 
increase in the tax credit during the developmental phase of this 
program, something that I understand was done for the beginning of the 
program for corn.
  With so much uncertainty facing the industry because of NAFTA, CAFTA, 
and other trade negotiations already in progress, I think this was a 
fair ask from the industry, from an efficient domestic industry that 
has been a robust engine for jobs in our economy for over 2 centuries. 
I wish the administration could have accepted that full and robust 
proposal in terms of ethanol.
  Our sugar farmers and processors work hard and deserve a level 
playing field. What I have been asking, what others have been asking is 
not simply protectionism for our domestic industry as far as the eye 
can see, but a level playing field dealing with this sugar issue on a 
global WTO basis so it can be dealt with fairly so our domestic sugar 
industry has at least a chance. That is

[[Page 15042]]

exactly what I will continue to fight for. That is precisely why I will 
continue to fight against CAFTA and urge its defeat in this body and in 
the House.
  In closing, I wish to take this opportunity to thank Chairman 
Chambliss and Senator Coleman for their efforts to find a solution to 
the sugar issue within CAFTA. They have been leading a bicameral 
effort, working diligently. It did not yield the results I hoped, but I 
salute them for their efforts.
  Unfortunately, as I said, those efforts did not prevail. That is why 
I strongly oppose CAFTA and why I ask my colleagues to do so, and 
specifically my colleagues in the House as this measure most probably 
moves there.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Wisconsin.
  Mr. FEINGOLD. Mr. President, I ask unanimous consent that I be able 
to speak instead of Senator Kerry under the previous order, to be 
followed by Senator Lautenberg for 10 minutes under the time controlled 
by Senator Dorgan, to be followed by a Republican Senator to speak 
under the time of Senator Grassley.
  The PRESIDING OFFICER. Is there objection?
  Mr. VOINOVICH. I object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. FEINGOLD. Mr. President, I ask unanimous consent that I be able 
to speak instead of Senator Kerry under the previous order for up to 20 
minutes.
  The PRESIDING OFFICER. Is there objection to the second unanimous 
consent request that the Senator from Wisconsin be able to fill the 
time of Senator Kerry for 20 minutes instead of 15 minutes? The Senator 
from Utah.
  Mr. HATCH. Mr. President, I ask unanimous consent that the 
distinguished Senator from Wisconsin on the Democratic side be the next 
speaker for 20 minutes, that he be followed by Senator Lautenberg for 
10 minutes, and then Senator Voinovich will immediately follow Senator 
Lautenberg for at least 20 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Wisconsin.
  Mr. FEINGOLD. Mr. President, I rise to oppose the Central American 
Free Trade Agreement, known as CAFTA, the latest expression of the 
disastrous trade policies of this administration which are, 
unfortunately, a continuation of the disastrous trade policies of 
previous administrations.
  I hold listening sessions in each of Wisconsin's 72 counties every 
year. I have held those listening sessions for over 12 years now, 
listening to tens of thousands of people from all over Wisconsin. I 
recently completed my 900th of those sessions, and I can say that there 
is nearly universal frustration and anger with the trade policies we 
have pursued since the late 1980s. Even among those who would have 
called themselves traditional free-traders, it is increasingly obvious 
that the so-called NAFTA model of trade has been a tragic failure.
  I voted against NAFTA, GATT, and permanent most-favored-nation status 
for China, in great part because I felt they were bad deals for 
Wisconsin businesses and Wisconsin workers. At the time I voted against 
those agreements, I thought they would result in lost jobs for my 
State.
  Even as an opponent of those trade agreements, I had no idea just how 
bad things would be.
  And things could hardly be worse. One can see the results of those 
policies in hundreds of communities around my State. As one might 
expect, our largest communities--places like Milwaukee, Madison, and 
Green Bay--lost thousands of jobs as a result of those trade policies, 
most notably NAFTA and permanent most-favored-nation status for China. 
But less obvious to some may be the devastation experienced by smaller 
towns and cities across my State. In those communities, the legacy of 
our trade policy has been especially cruel.
  Even if we only use the extremely conservative statistics collected 
by the Department of Labor, statistics which many argue grossly 
understate actual job loss, smaller communities all over Wisconsin have 
been the victim of the trade policies of the past decade.
  NAFTA's legacy of lost jobs includes places such as: Baraboo, with 
190 lost jobs; DeForest, with 40 lost jobs; Elkhorn, with 354 lost 
jobs; Hawkins, with 443 lost jobs; Marinette, with 54 lost jobs; 
Mauston, with 48 lost jobs; Merrill, with 263 lost jobs; Montello, with 
70 lost jobs; Oconto Falls, with 100 lost jobs; Peshtigo, with 95 lost 
jobs; Platteville, with 588 lost jobs; Spencer, with 23 lost jobs; and 
Waupaca, with 130 lost jobs.
  Some might suggest that 23 lost jobs in Spencer, WI are not all that 
many but when a small town loses a business, and the dozens or possibly 
hundreds of jobs that business provides, the impact surges throughout 
the entire community. Families are left without a breadwinner, or 
sometimes even two breadwinners. Stores are left without customers. New 
homes are not built. Families may be forced to move away. Schools lose 
children. The tax base drops, putting an increased burden on those who 
remain.
  When a bad trade deal results in lost jobs, it is not only those who 
lost a job who suffer.
  And the suffering in Wisconsin has been considerable. Altogether, 
Wisconsin has a net loss of more than 23,000 jobs because of NAFTA, and 
thousands more because of the other trade agreements into which we have 
entered in recent years.
  Now we have CAFTA, which is based on that same failed model of trade.
  I should note at this point that in too many instances, these trade 
agreements have been lose-lose trade agreements. They have been bad 
deals for our workers as well as the workers of our trading partners.
  This is a vital point, because many who are advocating CAFTA argue 
that the agreement is critical for promoting economic growth and 
reducing poverty in these Central American nations. In fact, the 
experience of the flawed trade model has been just the opposite.
  Eleven years of NAFTA have lowered living standards in Mexico, both 
for urban workers and in rural areas. Professor Riordan Roett of Johns 
Hopkins wrote on this very issue in a recent column, and this is what 
he had to say:

       Mexican workers under NAFTA lost precipitously through the 
     1990s, despite the extravagant promises made by proponents of 
     the model on which CAFTA is based.
       At least 1.5 million Mexican farmers have lost their 
     livelihoods under NAFTA. According to a 2004 report by the 
     Carnegie Endowment for International Peace, ``Agricultural 
     trade liberalization linked to NAFTA is the single most 
     significant factor in the loss of agricultural jobs in 
     Mexico. `` Thus far, limited employment growth in Mexico's 
     manufacturing sector has failed to absorb displaced rural 
     workers.
       This does not bode well for the CAFTA countries. A 2004 
     U.S. International Trade Commission study on the potential 
     impacts of CAFTA leads one to conclude that the agreement 
     will displace many in the rural sector in Central America. 
     Following a recent visit to Guatemala, United Nations Special 
     Raporteur for Food Jean Ziegler determined that CAFTA will 
     increase hunger and poverty once the agreement fully kicks 
     in. . . . one is left to wonder where the displaced rural 
     population of Central America will find employment.

  If the arguments made by the proponents of CAFTA sound familiar, it 
is because they are. CAFTA's advocates are making exactly the same 
arguments today that the proponents of NAFTA made a little over 10 
years ago. Because our markets are already largely open, they argue, it 
will be American businesses and American workers who will benefit from 
this trade agreement.
  It is an argument that sounds neat and simple, but let's compare the 
rhetoric to the record. In 1993, before NAFTA was implemented, our 
trade deficit with Canada and Mexico was $9 billion. In 2004, 10 years 
after NAFTA was implemented, our trade deficit with those two countries 
has ballooned 1,200 percent--1,200 percent--to $111 billion. By one 
estimate, the massive growth of imports into this country from Canada 
and Mexico relative to exports to those two countries has displaced 
almost one million jobs.
  Giving China permanent most-favored-nation trading status and 
ratifying the creation of the World Trade Organization have only made 
matters worse. Our trade deficit is now more than $600 billion.

[[Page 15043]]

  Far from improving our trade balance, NAFTA and these other trade 
agreements have only made matters worse.
  Our trade policy is fundamentally flawed. This is not a new problem, 
nor is it the fault of only one political party. The leadership of both 
parties have pushed these deeply flawed agreements, and too many 
Members from both parties were ready to support them without scrutiny.
  When questions were raised about the actual provisions of these 
flawed agreements, supporters were quick to play the free trade card 
and label those who questioned these policies as ``protectionist.''
  It is somewhat encouraging that some who blindly accepted these 
agreements are now beginning to read the fine print.
  One might think it obvious, but apparently it needs to be reiterated, 
these are not your father's trade agreements, and the elegant theories 
of Adam Smith and others do not apply to the agreements we are asked to 
approve. As Thea Lee wrote in a recent column in the Wall Street 
Journal:

       We should all understand by now that modern (post-NAFTA) 
     free-trade agreements are not just about lowering tariffs. 
     They are about changing the conditions attached to trade 
     liberalization, in ways that benefit some players and hurt 
     others. These are not your textbook free-trade deals. These 
     are finely orchestrated special-interest deals that boost the 
     profits and power of multinational corporations, leaving 
     workers, family farmers, many small businesses, and the 
     environment more vulnerable than ever.

  Millions of working families across Wisconsin know this.
  I sometimes think that if instead of exporting manufacturing goods 
China exported editorial writers, the opinion pages of our newspapers 
might reflect an understanding of this as well.
  The argument we hear is that trade deals like CAFTA may cause some 
short-term pain but they are ultimately good for all countries 
concerned. Maybe we lose a few jobs to Mexico or China, the argument 
goes, but we would also gain jobs. Each country would engage in the 
economic activity for which it has a so-called ``comparative 
advantage'' and everyone wins.
  But this nice, neat academic theory bears little relation to what is 
actually happening in the real world. And one of the reasons for this 
disconnect is that in an arena that has been fundamentally changed by 
technical advances, such as the Internet and the rapid flow of capital, 
we are not playing by the same rules as our trading partners.
  The trade agreements into which our country has entered in recent 
years too often lack even the most reasonable of standards to prevent a 
race to the bottom, and ensure that our businesses and workers can 
compete on a level playing field.
  This is certainly the case with CAFTA, which fails to include 
meaningful labor standards, and the weak standards that it does include 
are effectively unenforceable.
  CAFTA states that member countries cannot, for their own benefit, 
fail to enforce their labor laws. But the agreement also states that 
nothing in the agreement ``shall be construed to empower a Party's 
authorities to undertake labor law enforcement activities in the 
territory of another Party.'' Thus, any protections that might be 
afforded by the requirement to enforce current labor laws are left to 
each government to self-enforce. This really does nothing.
  Unlike the commercial provisions in CAFTA, the labor provisions 
cannot be enforced through binding dispute settlement, or trade 
sanctions. If a country violates its commercial obligations, sanctions 
can be imposed quickly, but a violation of workers' rights is only 
subject to a possible fine.
  In the unlikely event that a country is forced to pay a fine, it pays 
that fine to itself. While the fine is supposed to be used to fund 
domestic labor initiatives, we all know that such revenues are 
fungible, and there is no way to prevent a violating country from also 
transferring money out of its labor budget, so the fine adds no new net 
resources for enforcement. This is not an academic concern. Studies 
have documented serious labor violations in Central American countries.
  American businesses and American workers should not have to compete 
with countries with such flawed labor records.
  CAFTA also fails to include adequate environmental safeguards. What 
environmental provisions there are in CAFTA are largely cosmetic in 
nature.
  As with worker standards, the environmental standards that are in the 
agreement lack the kind of enforcement teeth provided to commercial 
provisions in the agreement.
  For example, while the agreement includes the establishment of a 
process under which citizens can identify failures to enforce 
environmental laws effectively, advocates note that the proposed 
citizen process has no clear enforcement mechanism to ensure action on 
public complaints. By contrast, the enforcement mechanisms for 
investment related provisions are real. Investors can demand monetary 
compensation of governments under CAFTA's investment rules.
  In fact, any hope that CAFTA countries might, on their own, 
strengthen environmental standards to make the playing field a bit more 
level is undermined by the investment rules included in the trade 
agreement.
  Those rules allow foreign investors to challenge environmental laws 
and regulations in front of international trade panels, circumventing 
local courts. Moreover, the threat of having to pay investor interests 
heavy monetary damages if a challenge is successful is certain to have 
a chilling effect on the willingness of CAFTA government, both federal 
and local, to establish the kinds of environmental protections that 
might help that region and provide better balance for American firms 
that must live under our own strong environmental laws.
  Among the rosiest of predictions made by the proponents of CAFTA are 
the positive impacts they claim for U.S. agricultural sectors. But our 
experience with NAFTA again leaves me deeply skeptical of such claims. 
The promises made to farmers that we heard over the early 1990s, have 
largely failed to materialize.
  But even setting aside for the moment the failure of NAFTA to deliver 
on those promises, even if we accept the most optimistic of projections 
by CAFTA's proponents, there is no scenario under which this helps 
small family farmers in Wisconsin or the Nation. The American market 
dwarfs the CAFTA market, so any benefits will be miniscule and 
concentrated in the middlemen and large agribusinesses.
  I am afraid to say that is the up side. The down side is that CAFTA 
sets up an unfair playing field that could put our farmers at a long-
term competitive disadvantage.
  As my visits with Wisconsin farmers have shown me, American farmers 
are not afraid of competition and I would not hesitate to put them up 
against any other farmers across the world on an equal footing. The 
problem is that CAFTA does not provide this fairness. Instead, 
Wisconsin and the rest of America's farmers are required to meet 
environmental and labor standards to both keep the water, air and land 
clean and at the same time pay their employees a living wage.
  As I have noted, CAFTA does not require the same standards in other 
countries.
  Our farmers can attest that our environmental and labor standards are 
very real and enforced. CAFTA does nothing to level the field on which 
our farmers will be asked to compete, and that tilted playing field 
apparently extends even beyond CAFTA countries.
  For example, ethanol production has long been considered an 
opportunity for American farmers to reap greater and consistent income 
from their crops, while helping to reduce our dependence on foreign 
fuel. But under CAFTA, Central American countries could become a 
conduit for cheap ethanol exports to the United States, importing 
unlimited amounts of ethanol tariff free even if they were blended with 
50 percent ethanol from non-CAFTA countries like Brazil.
   Perhaps most concerning to me is that while CAFTA would put American 
farmers at a competitive disadvantage

[[Page 15044]]

with the relatively small CAFTA market, its impact could be far 
greater. CAFTA will likely be used. as the blueprint for the much 
larger Free Trade Agreement of the Americas. If this retreat from the 
principle of fair trade is repeated there, the negative effects could 
be dramatic and felt throughout U.S. agriculture.
  Wisconsin has paid a heavy price for CAFTA's predecessors. Since 
2000, Wisconsin has lost nearly 92,000 manufacturing jobs. NAFTA, the 
GATT, and most-favored-nation treatment for China have devastated local 
businesses and punished working families, taking away family-supporting 
jobs, and offering lower-paying jobs, if any, in return.
  When the impact of these agreements comes crashing down on people's 
lives, it is clear that we have already traded away too much in a 
series of bad deals.
  CAFTA promises more of the same devastation brought by the agreements 
that have come before it, putting our businesses, workers and farmers 
at a competitive disadvantage, while also undermining the economic 
development that might benefit workers, farmers and small businesses in 
Central America.
  This trade agreement fails on every count. I urge my colleagues to 
scrap it and tell the administration to come back with a deal that is 
fair to American businesses, workers and farmers, as well as the small 
businesses, workers and farmers of our trading partners.
  I yield the floor.
  Mr. BAUCUS. Mr. President, under the order the Senator from New 
Jersey is recognized next for 10 minutes. I ask unanimous consent he be 
given an additional 5 minutes, total of 15, and the time to be taken 
out of the time allocated to Senator Dorgan.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from New Jersey is recognized.


                                  Iraq

  Mr. LAUTENBERG. Mr. President, I thank the Senator from Montana. 
Today I want to discuss the speech made by the President Tuesday night 
about Iraq. I think it is encouraging that the President is reaching 
out to the country and attempting to explain his policy in Iraq. But I 
think, to be more effective, the President has to be candid and upfront 
with the American people.
  Frankly, in my view, the credible speech on this subject should have 
come from the Oval Office, not from a stage with uniformed service 
people all around. Apparently, a patriotic backdrop behind the 
President, and rows of soldiers in dress uniforms, was necessary to 
speak to the American people about the crisis our country faces in 
Iraq. It was, I thought, good theater, but not a very informative 
speech. Maybe that is why the soldiers didn't applaud until the White 
House staff urged them on.
  Tuesday night's staged show reminded me of another Hollywood-type 
event, when President Bush declared ``mission accomplished.'' We all 
remember this picture very clearly. It was on an aircraft carrier, with 
signs up--their authorship was denied by lots of people. The Navy 
personnel were standing there directly behind the President. The speech 
took place on May 1, 2003, just slightly over 2 years ago, when the 
President said to the country at large that major combat was over in 
Iraq.
  How wrong he was. Before the ``mission accomplished'' speech on May 
1, we had lost 139 people and had about 500 of our troops wounded. 
Since President Bush's ``mission accomplished'' declaration, we have 
lost 1,594 Americans in Iraq--versus that 139, 2 years ago. Almost 
1,600 versus 139; and 12,000 seriously wounded versus 500 at the time, 
in that 2 years.
  It has been a terrible 2 years. Despite the gigantic banner and the 
theatrical presentation on the aircraft carrier 2 years ago, the 
mission was not accomplished then and it is not accomplished now. In 
fact, the mission isn't even close to being accomplished, as all of us 
in America, and I am sure the President is included, would like to see.
  We are not going to solve our problems in Iraq through spin and photo 
ops. We will solve these problems only with a tangible plan that gets 
our troops home and then we will all truly celebrate mission 
accomplished. Not only are we not seeing a plan, but high level 
administration officials seem to be in serious disagreement about the 
status of the insurgency. One day we saw Vice President Cheney say that 
the insurgency is in its ``last throes.'' Then a few days later we see 
Secretary Rumsfeld say that the insurgency could last ``12 years.''
  This war has turned into a quagmire and Americans want to hear what 
changes we are making to address our growing difficulties in Iraq, and 
unfortunately a lot of what we heard from the President Tuesday night 
was rhetoric. Unfortunately, much of the President's rhetoric focused 
on September 11. But simply referencing September 11 over and over 
again does not explain how we are going to move forward in Iraq. In 
fact, it only serves to remind the American people that our most 
dangerous enemy, Osama bin Laden, is still on the loose, and we are all 
perplexed by the statement made by Mr. Goss, the head of intelligence, 
that we know where Osama bin Laden is. I don't know why we don't go get 
him if we know where he is.
  Nearly 4 years after the 9/11 attacks, Osama bin Laden, the leader of 
the terrorist group that killed almost 3,000 Americans, including 700 
of our neighbors and friends from my State of New Jersey, continues to 
inflame his terrorist network. Al-Qaida cannot be effectively 
dismantled unless we capture bin Laden, and getting him should be our 
No. 1 priority, but it seems it has moved its way down on the 
President's priority list.
  I urge President Bush not to use September 11 again as a way to 
support our failures in Iraq. The American people would rather you 
simply address the problems and fix them.
  Poor planning for the war in Iraq is causing serious long-term 
problems for our military. Mainly we are failing to meet our recruiting 
goals. Yes, I know we had a blip up in the present month, but in May 
the Army fell about 25 percent short of its recruiting target. That is 
after they lowered their target. The Army also missed its monthly 
targets in April and March and February of 2005, each month worse than 
the one before. In February it fell 27 percent short. In March the gap 
was 31 percent short. In April it was 42 percent. Things are so bad 
that the Army is contemplating $40,000 signing bonuses for new 
recruits. It reminds me of some of the bonuses offered athletes who 
sign contracts. That may rival what professional ballplayers get. And 
the Army is perhaps going into a new deal that allows for very short 
enlistment periods, as low as 15 months of active duty.
  The National Guard and Reserves are even farther behind in recruiting 
this year. The Army Reserve met only 82 percent of its May recruitment 
goal and the Marine Corps Reserve met only 88 percent of its recruiting 
goal. This raises questions. Even if the President agrees to send more 
troops to Iraq, where are they going to get them? I don't think it is 
simply the casualty numbers that are hurting recruiting. It is a sense 
that this administration does not have a plan for Iraq--and maybe they 
never did. After all, in March of 2003 Vice President Cheney predicted 
that the conflict would last ``weeks rather than months.'' Now it is 
years and, according to Secretary Rumsfeld, it could be over a decade 
before the country is stabilized.
  What about those Army service men and women who return to our country 
and become veterans? Look at how they are being treated by this 
administration. My Democratic colleagues Senator Murray and Senator 
Byrd tried three times to increase funding for the VA this year because 
they understood that veterans returning from Iraq are going to need 
more help. What happened? Republicans voted those amendments down each 
time. Why? Because the administration kept saying ``we don't need the 
money.''
  But just this week the VA Secretary, Jim Nicholson, suddenly realized 
he is facing a $1 billion budget shortfall. Nicholson said it was 
``unexpected.'' Unexpected? How could they not expect increased needs 
from the troops coming back from Iraq? We know people are

[[Page 15045]]

being severely wounded there, and returning and needing a lot of 
attention. What kind of message does this send to our troops? We forgot 
to fund your veterans health care needs? I think it is shameful and 
shows a lack of respect.
  Only now, because of embarrassment, did we see the other side of the 
aisle vote for Senator Murray's amendment to increase VA funding. All 
of a sudden a prominent member of the Republican leadership, the junior 
Senator from Pennsylvania, after repeatedly opposing increases to VA 
funding, has become an enthusiastic cheerleader. It is interesting how 
elections motivate people.
  Our service men and women and their families are getting a raw deal. 
Because of the administration's lack of planning, military families are 
stuck with extended tours of duty leading to family problems and 
serious financial difficulties. A real eye opener is to talk to some of 
the Reserve and Guard people who have returned from Iraq and find 
themselves in desperate situations with family problems, upset 
relationships, financial disaster. It is terrible.
  The bottom line is we need plain, straight talk coming out of the 
White House and not staged events such as ``mission accomplished'' in 
Tuesday night's speech.
  One of my distinguished Republican colleagues, a combat veteran of 
the Vietnam war, recently said:

       The White House is completely disconnected from reality.

  And it is tragically true.
  If the President wants to earn back the American people's trust on 
his Iraqi planning, he needs to start by being truthful and admitting 
some mistakes. So far that hasn't happened and I plead with the 
President and this administration: Level with the American people. It 
is a very discouraging picture out there when we see the casualties 
mount and the morass thicken.
  Mr. President, I yield the floor with this plea: Say it like it is.
  The PRESIDING OFFICER (Mr. Alexander). The Senator from Ohio is 
recognized for 20 minutes.
  Mr. VOINOVICH. Mr. President, I rise today to discuss the Central 
American Free Trade Agreement--CAFTA. I have been a long-time supporter 
of expanding United States trading relationships. I believe trade is 
vital to the long-term health of the U.S. economy and to raising living 
standards around the globe. Since my days as Governor, I have worked to 
open markets around the world for Ohio's exports. Exports are extremely 
important to the Ohio economy. When I was Governor, exports were one of 
my four economic development priorities.
  During my tenure in the Senate I have supported the vast majority of 
trade agreements that have been brought before the Senate. However, in 
the last year and a half or so, I have been troubled by several aspects 
of our trade policies that I believe severely, and understandably, 
undermine the American people's support, as well as my own support, for 
new trade agreements.
  In particular, I believe the failure of the United States to properly 
enforce its existing trade agreements has contributed to growing 
skepticism of the American people about the benefits of trade. In 
particular, the failure to enforce the intellectual property right 
protections in our trade agreements has contributed to a proliferation 
of counterfeiting and pirating of American products across the globe.
  I have met with numerous Ohio business leaders whose support for 
trade has been severely tested when their company's products were 
counterfeited by firms operating in countries whose governments simply 
refuse to live up to their commitments to protect intellectual property 
rights.
  I believe in free trade, but the cornerstone of free trade is the 
protection of property rights. It is unreasonable to expect American 
companies to compete against companies from countries that do not abide 
by this basic principle.
  Last year I was so troubled by the lack of enforcement of our trade 
agreements I decided the United States should hold off entering into 
any new trade agreements until our enforcement efforts dramatically 
improved. Accordingly, I voted against the Australian and Moroccan Free 
Trade Agreements. Those were not popular votes, but they were necessary 
to draw attention to the need to enforce our trade agreements.
  Although I have been critical of the way our trade agreements have 
been enforced, I remain committed to seeing the United States continue 
its leadership in promoting lower trade barriers and global trade. My 
criticism is that of a friend of trade and one who wants to see the 
U.S. trade policy succeed.
  Accordingly, I have been very pleased with the administration's new 
efforts to improve the enforcement of our trade agreements. Earlier 
this year, I held a hearing by the Homeland Security and Governmental 
Affairs Subcommittee on Oversight of Government Management, the Federal 
Workforce and the District of Columbia, to examine the administration's 
new Strategy Targeting Organized Piracy or STOP! Program which aimed to 
combat intellectual property theft abroad and help small and medium 
size businesses protect their intellectual property. Although much more 
needs to be done, STOP! is off to a very good start.
  I hope my colleagues in the Senate will familiarize themselves with 
the STOP! program because it will be of great assistance to small 
businesses in States that have had their intellectual property rights 
infringed upon.
  Mr. VOINOVICH. I am very pleased with the efforts of Secretary of 
Commerce Thomas Gutierrez and my good friend Ambassador Rob Portman at 
USTR to help several Ohio companies, victims of intellectual property 
theft abroad. They have shown the importance of enforcing our trade 
agreements and are committed to improving our enforcement record, 
especially in the area of property rights. I am very impressed by how 
much progress they have made during their short tenures in raising the 
issue of intellectual property rights abroad, and I am confident they 
will continue to work closely with Congress to address trade issues.
  Our trade policies are only as good as the people who execute them. I 
am pleased to say we have excellent leadership right now in Secretary 
Gutierrez and Ambassador Portman. They both have a good background on 
trade. Secretary Gutierrez has firsthand experience with trade issues 
due to his work as CEO of Kellogg. Ambassador Portman has unique 
knowledge of trade legislation as a result of his work as a member of 
the Ways and Means Committee while he was a Member of Congress.
  Recently, I sent a letter to the President asking him to appoint a 
coordinator for all of the agencies that deal with commerce--Commerce, 
the Patent Office, USTR, Homeland Security, Customs, Border Patrol, and 
the Justice Department. They need someone to coordinate them so they 
get the job done.
  I was also pleased to hear Treasury Secretary Snow's comments earlier 
this week that he is prepared to cite China if it does not address the 
yuan's overvalued exchange rate against the dollar.
  In light of the administration's new effort to improve enforcement of 
our trade agreements and in consideration of the merits of the 
agreement, I have decided to support the Dominican Republic-Central 
America-United States Free Trade Agreement. Passage of CAFTA will lay 
the foundation for a growing and valuable trade relationship with CAFTA 
countries as well as strengthen the U.S. leadership position in 
promoting global trade.
  I believe CAFTA embodies precisely the type of long-term economic 
planning that we too often fail to integrate into our policies. CAFTA 
will not only facilitate the expansion of trade between the United 
States and other CAFTA countries by eliminating most trade barriers but 
will also help American companies get on the ground floor in those 
developing countries, ahead of our competitors in Europe and in China.
  Right now, the CAFTA countries have relatively small economies, but 
they have made great progress over the last decade. Over the past 5 
years alone, U.S. exports to Central America have increased by 35 
percent. As these

[[Page 15046]]

countries continue to grow, we will see growing demands for our 
exports. Presently, about 44 percent of the region's imports come from 
the United States, so as their economies expand, so will purchases of 
American products.
  Moreover, the United States has already accorded duty-free treatment 
to more than 80 percent of Central American imports to the United 
States under the Caribbean Basin Trade Partnership Act and other trade 
agreements. As a result, CAFTA is largely a one-way lowering of trade 
barriers by the CAFTA countries and will measurably improve our 
opportunity to export to those countries.
  Presently, the CAFTA countries impose high tariffs on agricultural 
products, especially on several of Ohio's top agricultural exports such 
as soybeans, corn, dairy products, beef, and pork. Under CAFTA, these 
tariffs will be eliminated, making Ohio's agricultural exports much 
more competitive in the CAFTA country. Since most agricultural products 
from CAFTA countries already enter the United States duty free, CAFTA 
levels the playing field and gives American farmers the same access to 
the markets in the CAFTA countries. For Ohio farmers, CAFTA is a good 
deal. Not surprisingly, CAFTA has received support from the Farm 
Bureau, the Ohio Cattlemen Association, Soybean Association, Poultry 
Association, and, of course, the Ohio Corn Growers Association.
  CAFTA is also very important to the survival of the U.S. apparel 
industry. Only with open access to CAFTA can American apparel compete 
with China. Unless CAFTA is passed, we will see the entire American 
apparel industry move to China.
  CAFTA also improves the protection of intellectual property in the 
CAFTA countries. Under CAFTA's intellectual property provisions, they 
are obligated to ratify numerous international agreements on 
intellectual property rights to which the United States is already a 
signatory and will be obligated to enforce intellectual property 
rights. The ratification of these agreements is a very important step 
to protecting American companies from intellectual property theft 
abroad. While some may argue that more needs to be done, the fact is, 
if CAFTA does not pass, American companies will not have the protection 
of even those basic agreements.
  We often forget that trade agreements are about more than just trade. 
They are key components of American foreign policy. They are one of the 
best ways this country can develop better relationships around the 
globe. At a time when I believe the United States badly needs to 
improve its relationship with other countries, trade agreements offer 
us an excellent opportunity to reach out to the other countries and 
foster economic ties.
  The CAFTA countries are exactly the types of countries with which we 
should build better relationships. After decades of civil wars, the 
CAFTA countries have made dramatic progress toward establishing 
democracy and market-based economies. Because the United States is 
their largest trading partner and foreign investor, the CAFTA countries 
need a good trade relationship with the United States to fuel their 
development and help them to continue their reforms. By passing CAFTA, 
we can help ensure that our southern neighbors succeed in their reforms 
and in the process greatly expand our influence in the region. I note 
that President Jimmy Carter supports CAFTA for precisely this reason.
  It is in the best strategic interest of the United States to see that 
CAFTA countries become successful republics and do not once again fall 
victim to economic crises and civil wars. The existence of stable and 
prosperous countries in our southern border will not only be good for 
American commerce but also good for American security.
  Approval of CAFTA will also send an important signal to the countries 
in the region as well as other developing countries that the United 
States is committed to assisting them in building their economies. If 
the United States does not develop closer relationships with these 
countries, they will undoubtedly look elsewhere for help, such as the 
European Union or, more troubling, to Cuba, Venezuela, or China. 
Rejection of CAFTA will only clear the way for our competitors to enter 
our backyard. In my opinion, a defeat of CAFTA is a victory for China 
and Cuba.
  In addition to rejecting CAFTA, it would greatly damage Ambassador 
Portman's ability to open markets for U.S. exports at the Doha round of 
WTO negotiations and with respect to the planned trade agreement with 
the Andean nations and for the free trade area of the Americas. The 
U.S. trading partners would have a reduced incentive to agree to open 
their markets to U.S. goods because they would claim, sincerely or 
tactically, that the U.S. commerce will not be willing to approve a 
final agreement. To get other countries to agree to politically 
unpopular reductions in trade barriers, the United States needs to have 
credibility that it will do the same.
  Since the end of World War II, the United States has been the driving 
force in promoting trade liberalization. Because of U.S. leadership, 
global trade barriers have steadily fallen for nearly 60 years, greatly 
expanding world trade and helping to improve living standards around 
the world.
  I believe it would be unfair to Ambassador Portman to reject CAFTA 
and undermine his ability to continue the U.S. leadership on trade, 
especially given that he only recently assumed his post. Members who 
have worked with Ambassador Portman know he is very talented and a 
skilled legislator and negotiator who understands the importance of 
close consultations with Congress during the negotiation of any trade 
agreement. Hence, I think we have a great opportunity to improve 
Congress's involvement in the negotiation of trade agreements which 
would build support for future trade agreements by having Congress's 
concerns addressed early in the process. Too often, it comes in too 
late.
  We have somebody there as our new U.S. Trade Representative--and I 
have spoken to him about it--who understands because of his legislative 
experience that he needs to get over here and spend some time with 
Congress before the final touch is put on those trade agreements. By 
voting down CAFTA, however, we would undermine Ambassador Portman's 
ability to respond to our concerns in the future and negotiate better 
agreements.
  CAFTA is a good agreement which will further integrate the United 
States in the world economy and help ensure the United States remains 
the world's leader in global trading. I urge my colleagues to vote in 
favor of this agreement.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I have a rough understanding that Senator 
Dorgan will speak next. He is not here.
  I suggest the absence of a quorum and ask consent that it be charged 
equally against both sides.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. Mr. President, I yield myself such time as I may 
consume.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. I will respond to some of the speakers through the 
course of debate on this bill who pointed to a report of the 
International Trade Commission on CAFTA as evidence that this trade 
agreement is not meaningful to the United States.
  Let me explain that the International Trade Commission is an agency 
of the Federal Government, but it is an agency that is very 
independent, with 9-year terms for members to serve. They do a great 
deal of research in international trade and are very well respected for 
the reports they put out.
  This report that was referred to as evidence of this trade agreement 
not being helpful to the United States misrepresents the scope of the 
International Trade Commission estimates

[[Page 15047]]

as well as the scale of the CAFTA agreement itself. Critics point to 
one part of the International Trade Commission report which estimates 
the tariff and quota liberalizations under the agreement will result in 
zero percent change in welfare for the United States.
  Now, those critics ignore the Commission's conclusion that if CAFTA 
is fully implemented, overall U.S. welfare will increase in a range of 
$135 million to $248 million, with minimal impact on U.S. employment 
and output.
  In fact, the Commission estimates that no sector of the U.S. economy 
is likely to experience a decline in output, revenue, or employment 
greater than 2.5 percent once CAFTA is fully implemented.
  So critics fail to acknowledge that the Commission's estimates are 
based only on the tariff and quota liberalization provided under this 
agreement. The Commission's estimates do not quantify the other very 
important elements of this agreement--which the people using this 
report to justify a vote against CAFTA take into consideration--such as 
the benefits from an improved regulatory environment, improved 
protection of intellectual property rights, efforts at trade 
facilitation, and liberalization of regulations governing investment 
and the provision of services we will sell to those countries of CAFTA.
  The Commission report does not attempt to quantify any broader 
geopolitical benefit to the United States of improved economic well-
being and political stability in the CAFTA countries as a result of the 
agreement. But the fact remains that those benefits--not referred to by 
the opponents of this agreement, who find it convenient to quote one 
part of a trade commission study but not the whole study--the fact 
remains, then, that if you look at the whole report of the 
International Trade Commission, those benefits are a part of this 
agreement, as well, and will materialize and are obviously good reasons 
for voting for this bill.
  After some critics are done arguing that CAFTA is meaningless to the 
United States, they do, however, point to another part of the 
Commission's report and offer another doom-and-gloom scenario. They 
point to the Trade Commission's estimates that suggest that once CAFTA 
is implemented we will increase our bilateral trade deficit with these 
countries by as much as $110 million. Those critics ignore the 
Commission's conclusion that if you take into account likely changes in 
our global pattern of trade, once CAFTA is fully implemented, then our 
overall trade deficit is likely to decline by $750 million.
  Now, how does the figure of $750 million get ignored, but a $110-
million figure gets taken into consideration? Well, it is quite obvious 
that the people who are quoting from this report quote what benefits 
their position for voting against CAFTA and do not look at the overall 
beneficial impact of CAFTA on the United States.
  That $750 million is a very important number. Our bilateral trade 
balance with individual countries or regions may be interesting to 
consider, but the one number that is of significance to our economic 
health is our overall trade deficit. According to the ITC, the 
International Trade Commission, CAFTA will help reduce that trade 
deficit by $750 million.
  Now, all the people crying about our trade deficit, are they going to 
take into consideration $750 million? Why on Earth would we walk away 
from that benefit, as the opponents of this agreement will have the 
United States do with their ``no'' vote?
  I hope this dispels the critics' misinformation about CAFTA. The fact 
is, when you read the ITC report in its entirety, it becomes clear that 
implementing CAFTA offers meaningful benefits to the United States, 
both in terms of improving the economic welfare of the United States 
and in terms of reducing our overall trade deficit.
  Again, CAFTA offers us those benefits with minimal impact on U.S. 
employment and output. That is not what Senator Grassley says, that is 
what the International Trade Commission says. And if you add all the 
other economic and geopolitical benefits that are not readily 
quantified, I believe the tremendous benefit of this agreement to the 
United States is then seen in its proper light.
  So I urge my colleagues not to be misled by the critics. The ITC 
report corroborates that CAFTA will be beneficial to the United States.
  Also, let me suggest that during this debate, I have heard much talk 
about the lack of Government policies concerning the trade deficit. I 
am not here to justify any trade deficit. I am not here to say those 
people who say it is too big are wrong. But I think I have heard left 
out of this entire debate a policy that we have had under Republican 
and Democrat administrations for a long period of time, and that is, 
the freedom of the American consumer to have access to any product made 
anywhere in the world that they want to buy. Because we believe in 
freedom, we believe in choice for our consumers. We believe the 
consumer ought to have the benefit of choice, of quality, and price. 
And we happen to have the consumers of America buying much and saving 
little.
  Now, is that right? I do not know. But people who are concerned about 
our trade deficit, do they want to shut off the faucet that allows our 
consumers to have the choice of anything? I may be speaking too 
sweepingly when I say this next sentence but I believe we let anything 
into our country that consumers want to buy, except for pharmaceutical 
drugs. Senator Dorgan and I have been working together to make sure the 
consumer has that choice as well, to drive down prices, and give them 
the best product they can get.
  Now, I do not think anybody wants to take freedom of choice away from 
American consumers. If we are spending too much on consumer products, 
importing too much, maybe we ought to have more incentives for savings, 
maybe we ought to be, without a doubt, enforcing our antitrust laws, 
antisurging laws, countervailing duties to be applied, and all those 
things that need to be done about the problem that exists. But our 
deficit is overwhelming because of consumer products coming into the 
United States.
  Wal-Mart brings in $18 billion from China--$18 billion of our 
imports; just one company. Now, when you go to Wal-Mart--I don't care. 
I happen to go to a Wal-Mart some. I don't go there as much as I go to 
our small businesses in Iowa to buy things but occasionally go there. 
Are you going to take that choice away from the American consumer by 
not having Wal-Mart import? I don't know. I don't see anybody 
suggesting that.
  Somehow we are led to believe that China is like a Japan with these 
big surpluses. China has a trade deficit as well. China has 3 percent 
of our national debt in bonds. Japan has 8 percent. Yet you would think 
that somehow that 3 percent is a major problem.
  I would suggest that what we ought to be doing here is encouraging 
our consumers to buy American, buy American, or don't buy so much 
consumer goods yourself, and invest that money that we send to Japan 
through Wal-Mart directly in U.S. bonds. Buy American products. Do as 
we did in World War I and World War II, be patriotic and buy U.S. bonds 
to help our economy.
  Consumers in America are king. And when consumers in America decide 
to cut down on our trade deficit, it will be cut down. I think 
consumers ought to continue to be king in America because that is 
economic freedom, that is individualism, that is America.
  Mr. DORGAN. As to the question is all this a good thing, has it 
strengthened our country, or is this just gloom and doom by those who 
oppose the current trade strategy, my colleague is quite right, this is 
not a strategy that is just the George W. Bush strategy. This strategy 
has developed over about 25 years, although I must say that this 
administration is the most helpful to corporate interests that I have 
seen. But it is not just a strategy of the last year or two.
  But it is hard--very hard--to take a look at these devastatingly 
dangerous trade deficits that get worse and worse and worse, and then 
hear some people

[[Page 15048]]

say it is getting better and better and better for us. It is, of 
course, not getting better for us.
  Ronald Reagan used to tell that old story about the young boy who 
would look at the pile of manure and insist there must be a Shetland 
pony someplace. The fact is, there is no Shetland pony here. This is 
bad news. And the quicker we decide to confront it, look it square in 
the eye and decide as a country to do something about it, the better 
for our country.
  The question is about freedom. I agree with that. It is about 
freedom, freedom for the American consumer, also freedom for American 
workers to be able to reasonably expect in this great country they will 
be able to find a decent job that pays well with benefits. That is 
freedom that is important as well.
  When American workers are told on a Monday or a Friday--most 
characteristically a Friday--by Maytag or by Levi's or by Fruit of the 
Loom or by Fig Newton cookies or by Huffy bicycles or by Schwinn--and I 
could go on--that their job no longer exists because their employer has 
the freedom to get rid of them and hire somebody for 30 cents an hour--
that is freedom. Yes, that is freedom.
  What does it do to the country we built? This country was built on a 
debate in this Chamber about a wide range of critically important 
issues: Should you have the right to organize as workers? Should you 
have the right to expect to be able to work in a safe workplace? Should 
you have child labor laws? Should you prevent dumping pollution into 
the skies and the streams of this country and this world? We fought 
that battle for 100 years.
  Now those who want to avoid those onerous restrictions pole vault 
over all of them and say: My jobs are going to China. And you American 
workers? Sayonara. See you later. Goodbye. So long. It doesn't matter. 
You were just tools. You were like a wrench or a pair of pliers, ready 
to be thrown away when we were done with you.
  I have a lot to talk about this afternoon and a fair amount of time 
in which to do it. I yield to my colleague from Colorado, Senator 
Salazar, 15 minutes.
  The PRESIDING OFFICER. The Senator from Colorado.
  Mr. SALAZAR. Mr. President, I rise today to speak on the Dominican 
Republic-Central America-Free Trade Agreement. At the outset, let me 
say I appreciate the efforts of Commerce Secretary Gutierrez and his 
heartfelt advocacy for this agreement. I look forward to working with 
him to create jobs in Colorado and on trade and commerce issues, 
including future revisions to this trade agreement. I have spent the 
last several months learning more about the CAFTA agreement, listening 
to individual farmers and ranchers throughout Colorado on their 
concerns about being left behind. Based on extensive deliberation, I 
regret that I must oppose this agreement because it continues a policy 
in Washington that forgets huge parts of our country. Let me summarize 
my opposition to this agreement.
  First, there are huge parts of our country, including the eastern 
plains of Colorado, which have been forgotten by administration after 
administration, and they continue to wither on the vine. Those rural 
communities that continue to decline in population are going to be 
impacted in a very negative way by the implementation of the CAFTA 
agreement.
  Secondly, I am troubled by the fact that we have not had a policy to 
deal with the real geopolitical challenges that we face with Central 
and South America. When one thinks back to the days of John Fitzgerald 
Kennedy and his announcement of an Alliance for Progress for the 
Americas, he had a strategy with respect to how we are going to make 
friends both to the north and to the south, that we are going to help 
to rebuild the democracies of Central and South America.
  We have not seen that kind of a comprehensive policy from this 
administration. Instead, what we have seen is an episodic approach to 
dealing with the issues of Latin America. It is for those reasons that 
I have decided to oppose this agreement.
  In my State of Colorado, I have seen firsthand the forgotten America. 
Surveys done by the Colorado Department of Agriculture have cited 
steady declines in the number of cattle across my State. The inventory 
of cattle is reported the lowest in Colorado since 1962. Furthermore, 
in 2002, 60 percent of farms and ranches in Colorado had annual sales 
of less than $10,000. Specifically, the eastern plains of Colorado, 
which would be the place most impacted by the CAFTA agreement, is truly 
the place where you see the forgotten America in its most difficult of 
times. It is home to farmers and ranchers and small communities that 
are vanishing, left behind by a Washington, DC, that has lost touch 
with what is important to the people and to the communities of the 
heartland. The eastern plains of Colorado is also home to the sugar 
beet farmers of my State who, in 2002, in order to save their farms, 
banded together with over 1,000 other sugar beet growers in Nebraska, 
Montana, and Wyoming to form the Western Sugar Cooperative, a sugar 
processing facility which continues to successfully operate today 
across Colorado and the other States. In order for them to do that, 
they mortgaged their homes, their farms, their ranches, their tractors 
in order to be able to build this facility for the good of the rural 
communities and the operations they represent.
  The sugar beet growers believe that DR-CAFTA will set a precedent. It 
is a precedent that will send a message to our trade representatives 
that Congress will continue to allow haphazard negotiations of free-
trade agreements like CAFTA that will chip away at important industries 
and programs here in the United States. I will do all I can not to let 
these families and these communities continue to wither on the vine.
  At the same time, the International Trade Commission has stated that 
the U.S. trade deficit with CAFTA countries is projected to grow by 
more than $100 million. As my good friend from North Dakota said, 
speaking about the trade imbalance we are facing, this agreement will 
add to the trade imbalance of our country. Therefore, other Colorado 
organizations and many farmers and ranchers from throughout my State 
have joined together in opposition to CAFTA. It is uncommon in my 
State, frankly, to find the Colorado Farm Bureau and the Rocky Mountain 
Farmers Union coming together and speaking with one voice, saying this 
agreement is bad for agriculture. Yet it has happened with respect to 
this agreement. They both say this agreement is bad for agriculture.
  I also recognize that trade agreements are fundamentally geopolitical 
documents with important impacts on our foreign policy. It pains me 
personally to have to vote against this agreement. I do so because I 
recognize that many of our friends in these six countries see it as an 
important symbol of America's commitment to them. It pains me that I am 
not able to vote for this agreement. I do so, looking back at the 
history of our relationship between the United States and the Central 
American countries. During the 1980s, this country spent $5 billion on 
Central America in an effort to ensure that democracy and freedom 
markets triumphed in that part of our troubled world. Because of the 
courage and strength of our Central American friends, like Archbishop 
Oscar Romero, we see a region today that is defined by democracy and 
freedom, a region about which we could only have dreamed a short 20 
years ago.
  It is in that context that I have come to conclude that this 
agreement is a missed opportunity. Twenty years ago, you could not pick 
up a newspaper anywhere in the United States without a headline on the 
front page talking about some event or some episode in Central America. 
Today those countries barely merit a mention in an occasional 
newspaper. Presidents in the last 100 years have pursued the good 
policy, the Alliance for Progress, and the Summit of the Americas, and 
so forth. These policies have been pursued through administrations in 
differing parties, Democrats and Republicans, but they all shared a 
sense of commitment and focus on Latin America. I am

[[Page 15049]]

sad to conclude that the last several years have seen a policy that has 
been, at best, disinterested in the issues of South America and Central 
America.
  Consider this: The President's flagship foreign assistance program, 
the Millennium Challenge, has yet to distribute a single dime to 
Central America. Next, in the President's budget request for this year, 
Government investments in each of the countries subject to this 
agreement were cut, not increased. And finally, Latin America rarely 
appears in the administration's public remarks, despite the challenges 
of extreme poverty in Central America and democratic instability 
throughout the Andean region of South America. Supporters of this 
agreement are now telling us that to vote against CAFTA is to vote 
against Latin America. That could only be true if you believe that our 
policy toward this important region should be based only on a single 
trade agreement. It is not. It should not be. I have personally urged 
the President to work with members of both parties to reinvigorate our 
policy toward this important region of our world.
  Such a policy would do a number of things. For example, it would 
consolidate the democratic gains the region has made throughout the 
last two decades by investing in democratic parties. Instead of 
deepening democracy, the United States seems paralyzed as we watch 
democracy take hits in countries such as Venezuela and Bolivia. Next, 
we must battle underdevelopment in the region by investing in its 
people and microenterprise, health care, and education. Instead, Latin 
America is the only region that has not seen increases in U.S. 
Government investment in the last several years. Finally, we should 
fight corruption and deepen law enforcement cooperation to fight the 
scourge of illegal narcotics that passes through Central America on its 
way to our streets, affecting our kids and increasing criminality 
within our own communities.
  Such a policy should be, and must be, based on a vision larger than a 
single agreement. I regret that the tremendous energy the 
administration is now expending on this agreement has not laid out a 
vision and plan for the larger challenges, such as illegal immigration, 
drug trafficking, poverty, and the other issues that affect this 
important region of our hemisphere. That is why, in my view, this 
agreement represents a lost opportunity of action for our Nation.
  Lastly, let me say that I support trade for the Americas. I support 
trade for our Nation. I recognize that increased trade is good for our 
economy, for our businesses, farmers, workers, and families. But again, 
I wish we were here today talking about how we are opening new markets 
for our producers. Even under the most optimistic scenario, when this 
agreement is fully implemented, U.S. world exports are expected to 
increase by only a minuscule amount, if at all, to this small region. 
We simply need to do better at opening new markets, not just spend our 
time fighting to keep those we already have. If we spend all of our 
time fighting yesterday's battles on market access, we will miss the 
opportunity to leverage the major market opportunities that we have. 
That is why I have spent much of my first 6 months in the Senate 
working with the Department of Commerce and State to promote new 
markets, particularly for Colorado's agricultural products. That is why 
I asked Secretary Gutierrez to come to Denver last weekend to speak 
with Colorado's business, labor, and agricultural leaders. I am 
grateful for the Secretary having made this trip. I appreciated his 
candid discussion with my constituents in Colorado. That is why I have 
met with the Ambassador of China to urge him to send a trade delegation 
to Colorado on trade opportunities. And that is why I met with the 
director of the Taiwan Economic and Cultural Office to urge Taiwan to 
send a delegation to Colorado for the same reason.
  At the end of the day, I am hopeful there will be a CAFTA I can 
support. But just as importantly, I hope even more that we, as a 
Federal Government, will redouble our efforts to promote American 
exports into new markets around the world, including our own backyard.
  As I have deliberated on how to vote on this important agreement, I 
have thought a lot about Archbishop Romero, a courageous voice for 
dignity, change, and opportunity in Central America, and the lessons 
that we learned from his martyrdom in El Salvador. Shortly before he 
was assassinated, he said in Spanish:
  El Reino esta ya misteriosamente presente en nuestra tierra; cuando 
venga el Senor, se consumara Esta es la esperanza que nos alienta a los 
cristianos. Sabemos que todo esfuerzo por majorar una sociedad, sobre 
todo cuando esta tan metida esa injusticia y el pecado, es un esfuerzo 
que Dios bendice, que Dios quiere, que Dios nos exige.

       (English translation of the above statement is as follows:)

  God's reign is already present on our Earth in mystery. When the Lord 
comes, it will be brought to perfection. That is the hope that inspires 
Christians. We hope that every effort to better society, especially 
when injustice and sin are so ingrained, is an effort that God blesses, 
that God wants, that God demands of us.
  This agreement is not our best work as a nation. As we try to improve 
our society and the societies of Central America and the Dominican 
Republic, we can do better.
  I hope we get the chance to do better. I look forward to working with 
the administration to craft a better agreement with CAFTA.
  I thank the Chair and yield the floor.
  The PRESIDING OFFICER. The Senator from North Dakota is recognized.
  Mr. DORGAN. Mr. President, I compliment my colleague from Colorado. 
These have not been easy issues for him. I appreciate his position and 
understand it fully. I think he has represented that position well in 
the comments he offered today. We share--perhaps in some cases for 
different reasons--a feeling that this trade agreement is not a good 
one for our country.
  I yield 10 minutes to my colleague from Michigan, Senator Stabenow.
  The PRESIDING OFFICER. The Senator from Michigan is recognized.
  Ms. STABENOW. Mr. President, I thank my friend and eloquent leader on 
this issue, the Senator from North Dakota.
  Mr. President, I rise today, also, to share my great concern about 
this agreement and to oppose what I view as an unfair trade agreement. 
We can do much better than this. This country has been in an economic 
slump since 2001, and since then we have lost more than 2.7 million 
manufacturing jobs. Certainly, in my State, it has never been more 
clear as we see the headlines every day regarding job loss, jobs going 
to Mexico, China, and India--every day, headline after headline.
  At the same time, we have grown record budget deficits and a record 
trade deficit. Workers are losing their health care and higher 
education is becoming even more expensive. What is the response? Well, 
the administration decides to push through a CAFTA trade agreement that 
will dig the job holes even deeper. This makes absolutely no sense to 
me.
  This agreement will cost us jobs. It will increase our trade deficit. 
It will hurt our country's middle class, the backbone of our economy, 
our way of life. What makes us different from other countries is that 
rather than just having a few very wealthy people and a lot of poor 
people, we have a vibrant middle class, people who work hard, save, put 
their kids through college, and they know they can count on having--up 
until this point--a pension when they retire or they receive health 
care through their jobs. All of that is at risk right now for the 
people in Michigan and others around the country.
  This fight that we are having, this debate, is critically important. 
I think there is not a more critical debate to have on whether we are 
going to continue to support American businesses and American jobs and 
the American middle class. That is really what is at stake. We should 
pass legislation that will be creating jobs. We should be passing 
legislation that will lower the

[[Page 15050]]

trade deficit and will create more access to health care, lowering the 
cost of care and for college. There is a lot we should be doing.
  Unfortunately, I have concluded that this trade pact really moves us 
backward. It will lead us to more offshoring of American jobs. It would 
be better titled ``NAFTA part II.''
  However, so that I am not misunderstood, I do support trade. 
Obviously, the debate about trade or not to trade is not the right 
debate anymore. You could not put a wall up around this country if you 
wanted to. The Internet reaches anywhere. The question is, Are we going 
to be smart so that we can compete up rather than down, compete in a 
way that increases the middle class in other countries that will buy 
our products rather than losing our middle class and exporting our 
jobs? What is at stake here is really fundamental.
  I have supported trade agreements in the past. In fact, I voted in 
favor of six trade agreements in the last 4 years. I will give you an 
example of one of them. I supported the United States-Australia trade 
agreement because our economies are similar. Our workers get paid 
roughly the same amount of money. Our companies can sell their products 
in Australia because it has a high minimum wage, sound environmental 
laws, and good labor standards. We can sell and trade back and forth.
  Unfortunately, the CAFTA agreement does exactly the opposite. This 
packet will ship jobs overseas and provide fewer export markets for 
American companies, and it is because in these countries the minimum 
wage is very low. In Guatemala, the minimum wage is 25 cents an hour. I 
don't want our workers having to compete with 25 cents an hour. You 
cannot live on that. Mr. President, how can we expect to export to a 
market and compete with an economy where workers make 25 cents an hour, 
and there are no basic environmental laws and labor standards? I want 
to compete with a country where you can drink their water, where they 
can live on their wage, where we are competing up, not down.
  I believe we should try to support agreements that actually lift up 
workers in other countries as well as our own, as I said, so they can 
purchase our products. That is not what this does. Tragically, the 
countries involved in the CAFTA agreement are poor countries. For 
example, the median GDP in Nicaragua is only $2,300 a year. And 40 
percent of all workers covered under the agreement survive on less than 
$2 per day. It would make sense if we were putting in place an 
agreement that would raise those wages so they can buy our products. 
But I fear, from what I have seen in the past, that will not be the 
case. The entire purchasing power of all six of the CAFTA countries 
combined is less than the purchasing power of half of the city of 
Detroit.
  We are not competing on an equal playing field in this CAFTA 
agreement. I ask, how many Nicaraguans are going to be able to buy a 
$20,000 automobile made in Michigan? We want them to buy cars made in 
Michigan, by the way, Mr. President. We all know those who don't 
understand history are forced to repeat it. I am afraid that is what is 
happening.
  When we look at NAFTA, after Congress passed NAFTA, hundreds of 
thousands of American jobs were lost to Mexico. It is still happening. 
Last year, Electrolux, a plant in Greenville, MI, that makes 
refrigerators, announced they were going to move to Mexico, with 2,700 
good-paying jobs gone. Why? So they can pay $1.50 an hour in Mexico, 
with no health benefits. This is having a devastating effect on a small 
town community in the middle of Michigan. That is not the only story. 
There are hundreds of those.
  Right now, if we use NAFTA as a comparison, we see that over the past 
11 years U.S. workers have lost nearly a million jobs due to the 
growing trade deficits with our NAFTA partners. During the same time 
period, real wages in Mexico went down. Now, it would be different if 
it were true that wages went up, as we often hear, because that would 
make sense economically. But instead, in Mexico, wages have fallen, 
while the number of people living in poverty in Mexico has actually 
grown. It makes no sense to follow that line out again with another 
trade agreement. Since NAFTA took effect in 1994, the U.S. trade 
deficit with Canada and Mexico has ballooned to 12 times its pre-NAFTA 
size, reaching $111 billion in 2004.
  I believe we can expect more of the same from CAFTA, unfortunately. 
We can do better than this for American farmers, we can do better for 
American businesses, we can do better for American workers, and for 
American families. I hope we will reject this proposal and send them 
back to the drawing board. There are other models, other prototypes 
that have gotten it right. There are other agreements we have voted for 
on this floor that do a better job of creating and protecting our 
middle class and our jobs and businesses in America than this 
agreement. We can do better than this. We need to do better than this. 
I urge my colleagues to reject this agreement.
  We are once again rushing into a trade agreement that doesn't help, 
and in fact, has the potential to hurt American workers and their 
families.
  This country has been in an economic slump since 2001. Since that 
time, we have lost more than 2.7 million manufacturing jobs.
  At the same time, we have grown record budget deficits and record 
trade deficits. Workers are losing their health care and higher 
education is becoming ever more expensive. And, in Michigan we suffer 
from the nation's highest state unemployment rate.
  What is this administration's response? It has decided to push the 
CAFTA trade treaty that will dig the jobs hole even deeper. And, the 
administration has stripped out a trade adjustment assistance provision 
that would have helped workers displaced by CAFTA.
  This trade pact moves this Nation backwards. It will lead to more 
offshoring of American jobs.
  It will cost us jobs, increase our trade deficit and hurt our 
country's middle class. It will turn the haves into the have-mores and 
the have-nots into have-nothings.
  We should be negotiating trade agreements that involve exporting 
products, not jobs and we should pass legislation that will help create 
jobs, lower our trade deficit, and help working families get access to 
health care and college.
  However, so that I am not misunderstood I support free trade on a 
level playing field. I have voted in favor of six free-trade agreements 
over the past 4 years.
  For example, I voted for the U.S. Australia Free Trade Agreement 
because when we trade with Australia we trade on a level playing field.
  That agreement works because our economies are similar and our 
workers get paid roughly the same wage. Our companies can sell their 
products in Australia because it has a high minimum wage, sound 
environmental laws and good labor standards.
  Unfortunately, the CAFTA agreement goes in exactly the opposite 
direction.
  This agreement will ship jobs overseas and provide few export markets 
for American companies.
  My State of Michigan certainly will not benefit because this 
agreement does not provide a meaningful export market for Michigan 
manufacturers.
  That is because in order to have an export market you need to be 
selling to people who can afford your goods. But the typical wage in 
the CAFTA countries is very low.
  Tragically, these countries are poor. For example, the median GDP in 
Nicaragua is only $2,300 per year.
  And 40 percent of all workers covered under this agreement survive on 
less than $2 per day.
  The entire purchasing power of all six of the CAFTA countries 
combined is half that of the city of Detroit alone.
  In Guatemala, the minimum wage is approximately 25 cents an hour.
  How can we expect to export to a market where workers make 25 cents 
an hour and lack basic environmental laws and labor standards?
  We should try to lift up the impoverished workers in these countries 
so they can purchase American made products. But this agreement will 
not do that.

[[Page 15051]]

  As we all know, those who do not understand history are forced to 
repeat it. Let's take a look at what has happened in recent history.
  After Congress passed NAFTA, hundreds of thousands of American jobs 
were lost to Mexico. And it is still happening. Just last year, 
Electrolux closed a plant in Greenville, MI, and put 2,700 high paid 
workers on the street.
  Despite the fact that the company was making a profit and its workers 
were productive, the management closed the plant in Greenville and will 
soon open a new one in Mexico.
  If we use NAFTA as a comparison we see that over the past 11 years 
U.S. workers have lost nearly 1 million jobs due to growing trade 
deficits with our NAFTA partners.
  During the same time, real wages in Mexico have fallen while the 
number of people living in poverty there has grown, according to the 
Carnegie Endowment for International Peace.
  Since NAFTA took effect in 1994, the U.S. trade deficit with Canada 
and Mexico has ballooned to 12 times its pre-NAFTA size, reaching $111 
billion in 2004. Imports from our NAFTA partners outpaced exports to 
them by more than $100 billion, displacing workers in industries as 
diverse as autos, aircraft, apparel and consumer electronics.
  I believe we can expect more of the same under CAFTA.
  American farmers have also felt the impacts of NAFTA. We quickly 
discovered that this trade deal was no deal because it accelerated the 
agricultural products trade deficit.
  Consider that in the three years before NAFTA our trade surplus with 
Mexico and Canada increased by $203 million.
  After NAFTA, our surplus fell by $1.5 billion.
  The result is that some American crops, like tomatoes, have been 
pushed to the brink of extinction.
  Also, in 1994, Congress passed the General Agreement on Tariffs and 
Trade more commonly known as GATT.
  After we signed that agreement, we began to lose jobs to India, 
Indonesia and other East Asian countries.
  Now, workers in India are doing thousands of jobs that Americans used 
to do.
  They now staff call centers, provide technical support for our 
computer networks, and even process our tax forms and read our medical 
x-rays.
  To make matters worse, we passed so called most favored trade status 
for China in 1998. And since then, hundreds of thousands of Americans 
jobs are now done in China.
  Mr. President, you would think that after what has happened after 
previous trade agreements that we would know better than to pass 
another free trade agreement with countries that don't share our wage 
structure, labor standards, or environmental standards.
  Before we pass another free-trade agreement, why don't we first 
enforce our existing trade agreements.
  Currently, two of our major trading partners, China and Japan, are 
violating world trade rules by manipulating their currencies, which has 
the effect of making their products cheaper here and our products more 
expensive over there.
  Additionally, China refuses to seriously combat the rampant 
counterfeiting of auto parts.
  This hurts Michigan companies and costs American workers their jobs. 
This is unacceptable.
  That is why I, along with Senators Graham and Bayh, have introduced a 
bill that would create a trade prosecutor. This ambassador-level 
position within the office of the U.S. Trade Representative would be 
appointed by the President and confirmed by the Senate, with the 
authority to ensure compliance with trade agreements to protect our 
manufacturers against unfair trade practices.
  In practical terms, this prosecutor will have the authority to 
investigate and recommend prosecuting cases before the World Trade 
Organization and under trade agreements to which the United States is a 
party.
  Senator Grassley has assured me that this approach would be seriously 
debated while we continue to move forward on trade reauthorization and 
I look forward to working with him on this important piece of 
legislation.
  In addition to enforcing our current trade laws, we should pass other 
legislation that would help protect our jobs.
  First, we should close loopholes in the tax code that actually reward 
companies for shipping jobs overseas. Senator Dorgan has introduced 
such legislation to do so. Why aren't we passing that in the Senate?
  Second, why don't we help our companies deal with the runaway cost of 
health care so they can be more competitive overseas and keep our jobs 
here?
  Third, why aren't we more aggressively moving comprehensive pension 
reform to help our workers and companies through this very difficult 
economic time?
  Fourth, while we are building infrastructure over in Iraq, why can't 
we do the same here at home? Our roads, bridges, transit systems, and 
sewer systems are in dire need of repair. Why aren't we setting aside 
the resources now to repair them? Doing so would create hundreds of 
thousands of new jobs.
  Finally, why aren't we doing more to invest in new science and 
technology so our companies can better compete in the future? With very 
little federal funding, we are on the verge of producing a commercially 
viable hydrogen car and being the leader in the world on stem cell 
research.
  So, Mr. President, I ask my colleagues, why aren't we using our time 
to pass job producing legislation? How can we ask our workers to 
compete against economies that don't allow for collective bargaining, 
that don't maintain reasonable environmental standards, and don't 
maintain workplace safety requirements on par with the U.S.?
  It is not fair to their workers and it is certainly not fair to our 
workers.
  Why don't we work with these countries to help lift up their workers? 
Let's work with them to raise wages, provide health care, protect their 
environment and then we can enter into a free-trade agreement.
  This agreement represents a race to the bottom.
  A race to the bottom makes the world a poorer place--not a richer 
one.
  There are many things we can do to increase our trade with the world 
in a commonsense way. CAFTA is not one of them.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Texas is recognized.
  Mrs. HUTCHISON. Mr. President, I rise to speak in favor of this 
agreement. Twelve years ago, I rose in this Chamber to speak about 
NAFTA to express a vision that free trade will one day encompass all of 
North, Central, and South America. Today, we have an opportunity to 
further that vision by entering into an agreement that will strengthen 
U.S. trade relations and promote democratic reform in Central America.
  CAFTA will provide the U.S. exports with market access to Central 
America, similar to the duty-free access we have given Central American 
exports. Although nearly 80 percent of Central American and the 
Dominican Republic exports enter the U.S. duty free, America continues 
to pay high tariffs on over $1.5 billion of annual exports to Central 
America, our tenth largest export market globally.
  CAFTA rectifies this inconsistency by providing open market access to 
U.S. goods, services, and farm product exports. Specifically, over 80 
percent of U.S. consumer and industrial product exports to Central 
America and the Dominican Republic will be duty free immediately upon 
implementation of CAFTA. The remaining tariffs are phased out over 10 
years.
  Almost 20 years ago, Central American countries were ruled by 
dictators and communist insurgencies creating chaos and fostering 
corruption. With American support and encouragement, Central America 
has evolved into a region of fragile democracies. Elected leaders are 
welcoming freedom and encouraging economic diversity, while looking to 
the United States for a

[[Page 15052]]

means to develop a mutually beneficial relationship. CAFTA allows the 
United States to strengthen the economic ties we currently have with 
Central America and the Dominican Republic, while supporting political 
stability.
  History shows us that bilateral and regional free-trade agreements 
promote economic growth by significantly increasing U.S. exports. In my 
home State of Texas, exports to Chile have doubled since the Chile 
free-trade agreement was implemented in 2004. The success of NAFTA in 
the last 10 years yields similar results. Since NAFTA was implemented, 
combined exports from America to Mexico and Canada have increased by 
more than 150 percent in Texas, and 113 percent nationally.
  CAFTA shows the same promise and encourages U.S. growth as well. One 
out of ten jobs in the United States depends on exports. Similarly, 
foreign companies which invest in the United States create jobs. In 
fact, since 1990, foreign companies have invested more than $1.5 
trillion and employed more than 6 million U.S. workers. Free-trade 
agreements encourage export growth and help create jobs.
  I think it is important, also, to look at this from a hemispheric 
point of view. I do believe that it is important that we have free 
trade from the very north, Canada, all the way through the tip of South 
America. Strengthening our hemisphere will be good for America, and it 
will be good for every country in this hemisphere. It will also help us 
with many of the problems that we face with disparate economies. Many 
of our immigration issues come from people wanting to come to the 
United States because they cannot earn a living for their own families 
where they live. It is not that they want to leave their countries, it 
is that they are trying to provide for their families. If we have more 
free trade in our hemisphere, people will be able to support their 
families where they live, and we will have healthy economic relations 
with those countries rather than dealing with that on the basis of an 
immigration problem.
  So I do think that as we are looking at the places where we can 
strengthen economies, and where it is in our best interests to 
strengthen economies, we should look in our own backyard. We are having 
trade issues with China and with the European Union. Why not look to 
our own hemisphere, our own backyard, for strengthened relationships? 
That is what CAFTA will continue us on the right track to do. We have 
NAFTA and now we have Canada, the United States and Mexico; we have 
Chile and we have other countries in South America. I think the Central 
American agreement will add another component to that.
  I want free trade with every country in South America with which we 
can get an agreement. This is a very important part of our long-term 
stability and the strength of our economy and the economy of our whole 
hemisphere.
  I hope we will look at the big picture. I know that many Senators are 
concerned about jobs in their States and the impact this might have. 
Many people in Texas were very concerned about NAFTA because of the 
labor being less expensive just across the border, but NAFTA has been 
an overall plus for Texas, as it has been for America. We want to 
continue to strengthen our relationships with Mexico, Central America, 
and all the way through the tip of South America.
  Mr. President, I urge my colleagues to support this agreement.
  I ask unanimous consent that the time I consumed be charged to 
Senator Grassley.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. HUTCHISON. I yield the floor.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. DORGAN. Mr. President, I yield such time as I may consume from my 
allocation.
  There has been some discussion today about the U.S. International 
Trade Commission report on the CAFTA agreement. One of the complaints 
although not stated directly, is that this is an independent agency. 
Funny thing, independent agencies seem to be the most reliable 
agencies, at least, they are around this town. We do not get material 
from them that is colored one way or the other. It is an independent 
analysis.
  This probably is the most devastating critique of CAFTA. We have all 
of these people who load up their saddlebags and rush to the floor of 
the Senate telling us how wonderful this is going to be. They pull out 
all the goodies and say how terrific this trade agreement is for 
America. The problem is it is at odds with the independent analysis 
from the U.S. International Trade Commission.
  They say effects of tariff removal under this agreement are likely to 
result in virtually no benefit to our country. They say there will be 
little or no benefit to U.S. consumers. It says little or no change in 
U.S. production in distinct industry sectors, with one exception; the 
largest decrease in production is for manufactured sugar and sugar 
crops, of which the output of both will decrease.
  Then it says this will increase our trade deficit by $100 million. I 
don't know, maybe it is confusing to throw facts into this discussion 
about theology and economics and trade and all the things that are 
going on here. But here is a set of facts that is pretty hard for 
people to refute. They say, I have heard: ``You have to read the entire 
ITC report.'' I don't know, maybe so. I have looked at this report. I 
am reading the summary and the sector results, and it says if we sign 
on to this trade agreement, there is really no benefit to American 
consumers, virtually no benefit to American consumers, but a detriment 
to sugar producers and an increase in the trade deficit by $100 
million.
  I went to a really small school, but I learned in a small school that 
this would add up to a net deficit for our country. I do not understand 
how someone looks at this and says: ``All right, I have looked at this. 
It says this is bad for our country, but I think it is good for our 
country. And the problem is this is an independent agency.''
  That is a problem having an independent analysis on issues such as 
this that take off the rosy glasses and say: Look, here is what you are 
dealing with.
  Let me put a few charts up to show a few of the facts. I have said 
many times that everyone is entitled to their own opinion on this 
floor, but not everybody is entitled to their own set of facts. Facts 
are stubborn things. Let's talk about them.
  Since NAFTA began in 1994--that is the North American Free Trade 
Agreement--that is when we hooked Mexico and Canada with our trade. At 
that point, we had a slight trade surplus with Mexico. We have been 
able to ratchet that up to a huge deficit through this trade agreement. 
We had a modest trade deficit with Canada, and that has now become a 
huge trade deficit through this agreement.
  We have lost about 71,000 family farms. We have had a drop in 
agricultural trade surplus with Mexico and Canada by 71 percent. There 
have been 900,000 manufacturing jobs lost. There has been a drop in net 
farm income of 22 percent.
  I have told my colleagues, and I will tell them again, one day I 
drove to the Canadian border with a farmer named Earl Jensen. We got up 
to that border with a 12-year-old orange truck. This little old orange 
truck had about 150 bushels of durum wheat on it. So in an old orange 
truck, we pull up to the Canadian border. All the way to the United 
States-Canadian border, we had been meeting trucks hauling Canadian 
wheat into our country at secret prices which had been set by the 
Canadian Wheat Board, a sanctioned state monopoly in Canada that would 
be illegal in our country. All the way to our border we met these 18 
wheelers hauling Canadian grain into our country.
  Earl Jensen and I, with our little orange truck, get to the border, 
and they would not let us through. You cannot take American durum into 
Canada. It was not just us with the orange truck. There was a woman 
from Bowman, ND, who married a Canadian. She went to Canada for 
Thanksgiving. She got some wheat, put it in a paper sack and put it in 
the car because she wanted to use

[[Page 15053]]

that to grind up and produce whole wheat bread. ``You cannot do that,'' 
they said, when she got to the border. ``You have to dump out that sack 
of wheat.'' At the same time, we were flooded with Canadian durum 
coming into our country.
  Fair trade? Of course not. It is absurdly unfair. Nobody is willing 
to do a thing about it. It all came about because of NAFTA. We had a 
written agreement from Clayton Yeutter, who said representations of 
good faith in NAFTA are there will not be a substantial increase of 
grain trade across the border. In fact, that happened immediately by 
the Canadian Wheat Board--as I said, a sanctioned monopoly that would 
be illegal in this country--shipping into this country at secret prices 
a massive quantity of grain, taking money right out of the pockets of 
American farmers.
  Earl Jensen can probably be excused, at the Canadian border stop that 
afternoon, wondering how on Earth our Government policy allows Canadian 
grain to flood into our marketplace, and he and I cannot drive a 12-
year-old orange truck into Canada with just a small amount of U.S. 
wheat.
  The answer is quite simple. These trade agreements are incompetently 
negotiated, No. 1, and, No. 2, they are not enforced. That is where we 
are. That is what has happened since NAFTA. All bad news: A drop in the 
trade surplus in agricultural goods with Mexico and Canada; massive 
lost jobs in agriculture; 71,000 family farms lost.
  But it is not all bad news. It is bad news for the little guy. 
Corporate agribusiness profits are up 175 percent. Pretty good for 
them. The trade deficit with Mexico and Canada increased 266 percent. 
There is $4.3 billion in agricultural trade deficits with these two 
countries.
  The point is not everybody lost. You see, the corporate agribusiness 
profits went up when we lost farms and jobs. The little bee sucks the 
blossom, the big bee gets the honey; the little guy picks the cotton, 
the big guy gets the money. Bob Wills & His Texas Playboys sang that 70 
years ago and it still applies today and it applies in these trade 
agreements.
  The U.S. Government estimates that CAFTA will increase the trade 
deficit by $100 million. That is the ITC report I just described.
  I don't know how anyone can come to the floor of the Senate and say: 
I have my own set of glasses. I haven't cleaned them for a long time, 
but when I look through these glasses, I see nothing but nirvana, 
nothing but good news, when, in fact, no matter what glasses you wear 
around here, here is the ITC report which says this trade agreement we 
are about to sign onto will increase this country's deficit.
  This trade agreement, of course, is one more bit of the circular 
economic winds. This chart shows CAFTA will allow transshipment of 
foreign textiles through Central American markets from China, from 
Canada, down through the CAFTA countries into the United States.
  Somebody said today to me: ``So what. It happens anyway.'' Are we all 
giving up on helping American jobs remain viable? I don't understand 
that.
  Let me talk for a moment about sugar. There has been a lot of 
discussion about sugar. Sugar is an interesting commodity. I happen to 
like sugar. We produce sugar beets in the Red River Valley. All of us 
can be excused for liking something quite as wonderful as sugar. It, in 
fact, is organic. You plant a beet in the ground, watch that green 
stuff come up, and then see the growth and then pull that beet out of 
the ground during the beet harvest, run it through a plant, slice it, 
dice it, squash it, and get the juice out of it. It doesn't smell so 
hot in that plant when they are processing it, but pretty soon you have 
sugar, and most sugar in this world is traded country to country on 
long-term contracts. That is the way most sugar is traded in the world, 
country to country, in long-term contracts.
  The sugar that is outside of that, the sugar that is left over or in 
surplus is what is called dump sugar. It moves around the world at very 
low prices, just pennies a pound, very low prices. That is what our 
colleagues who know nothing about sugar, except the taste, come to the 
floor and lecture us about: ``Well, the world price of sugar is a 
nickel or 6 cents.'' Sorry, that is not the world price, that is the 
dump price for sugar. You cannot raise sugar for that. You cannot grow 
sugar beets for that. Most of the sugar is traded at higher prices than 
that on long-term contracts.
  We have a sugar industry in this country, and we have a sugar program 
in this country. Some do not like it, especially those who produce 
candy bars do not like it. The last time we had a debate on the floor 
of the Senate about sugar, I held up a Baby Ruth candy bar and read the 
ingredients. Oh, man, it is a long bunch of ingredients. Most of the 
things in candy bars you cannot pronounce. But there is a lot of sugar 
in candy bars, and that is what the debate has been about regarding the 
sugar program.
  Those who use sugar for their confections and candy bars do not want 
a sugar program; they want to buy dump sugar. The sugar program has 
been a good program to help stabilize prices in the country, yes, for 
producers and consumers. We have had times when sugar spiked way up, 
and then sugar prices came back down. Did you see a change in the cost 
of a can of pop or soda, a can of Coca-Cola, Pepsi, or Sprite? Did you 
ever see their prices come down when the price of sugar came down from 
a high spike? No, it didn't happen.
  This sugar debate has always been about those who use a lot of sugar 
in candy, soft drinks, and so on. They want to buy dump sugar at dump 
prices, and they would like to get rid of the sugar program.
  This sugar program is one part of the farm program that has worked 
consistently to provide consistent stability of income for American 
farmers. Yet a relentless urge in this Chamber is to take apart the one 
part of the farm program that has worked.
  Let me talk about sugar and this trade agreement. This trade 
agreement provides an opportunity for the movement of additional 
foreign sugar from the CAFTA countries into our country. We know they 
can produce sugar dirt cheap in some of these CAFTA countries. We know 
when we turn to the next trade agreement under the Free Trade Area of 
the Americas, they can probably produce it less expensively in Brazil 
and massive quantities of it. If we are going to be the recipients of 
dump sugar and be like a cork on the waves of the price of sugar, we 
will be subjected to the price spikes up high and then sometimes 
cheaper sugar.
  The fact is we will also destroy the current sugar producers in this 
country. In the Red River Valley of North Dakota and Minnesota, we have 
sugar beet growers. They go out in the morning and plow the fields, 
tend the crops, plant these beets. They are good people. They have a 
farm program that works called the sugar program. This is the first 
step in the direction of taking that sugar program apart, much to the 
glee of some because they never liked it. This is the first step of 
several steps because the next step in the Free Trade Area of the 
Americas will be the giant step.
  It is very interesting when you listen to these discussions about 
sugar. The Agriculture Secretary says this will increase sugar imports 
by about 1\1/2\ teaspoons of sugar a week for every one of our nearly 
300 million citizens. That is an interesting way to look at it. Another 
way to look at it would be that CAFTA will let in enough sugar to fill 
5,389 semi-trucks. This is just the first step in the wrong direction.
  This is just the first step in the wrong direction for trade. Through 
trade initiatives, we have done a lot of damage to our economy--good 
jobs leaving, jobs that pay well leaving, huge increased deficits. That 
means that it is the Chinese, it is the Japanese, the Europeans, the 
Mexicans, the Canadians who hold American dollars, American stock, 
American real estate in exchange for the trade deficit we have which 
grows by $2 billion-a-day--every day, 7 days a week.
  I said this morning that Warren Buffett describes this as heading 
toward share cropper days because others

[[Page 15054]]

in other parts of the world will own an increasing part of America. 
Piece by piece, day by day, they are buying part of our country.
  I finish with the sugar program to say this: I am not bashful at all 
about supporting our economic interests in this country. I am just a 
little sick and tired of people who are so quick to negotiate away our 
economic interests. Every trade agreement we have seen in recent years 
has negotiated away the economic interests of our country. I believe 
trade agreements are beneficial if they become trade agreements that 
bestow mutual benefits on the trading partners, but that has not been 
the case.
  Can anyone in this Chamber honestly look at the United States, 
Canada, and Mexico, the three countries combined, united in a trade 
agreement called NAFTA, and describe a manner in which this country 
won? Can anyone describe that honestly? They cannot. In each case, we 
ended up with a much larger trade deficit, and that trade deficit is a 
measurement of substantially greater imports into this country than 
exports from this country.
  It also means, then, that we lost jobs, lots and lots of jobs. No one 
wearing their Senate blue suit ever lost his or her job as a result of 
this trade agreement. It is just other folks who lost their jobs, 
people who loved their jobs, worked hard at their jobs, cared about 
their jobs, often worked for 20, 25, 30 years, only to find out one 
Friday their job was over because we negotiated trade agreements that 
moved American jobs elsewhere.
  When do we stop that? How much evidence does one need to decide it 
ought to stop, especially with respect to the issue of the sugar 
program and the sugar trade with Central America? Let us just instantly 
understand they can produce sugar much less expensively than we can, 
and I am going to go through some things and talk about the 
circumstances of labor in Central America and describe why they can 
produce sugar less expensively than we can. But they cannot produce a 
living wage for their workers in Central America. So let me go through 
some of those and connect it to the sugar program among other things.
  Under the labor laws in El Salvador and Nicaragua, it is legal to 
fire workers who belong to a union. In Honduras, it is legal to fire 
workers who say they intend to organize. In Nicaragua, it is legal to 
prohibit strikes without government permission. Our country wants to 
sign up to a trade partnership in which our workers should compete with 
countries with those labor standards? Are we thinking clearly here? Who 
wants to do that? Does that not by its very definition denigrate 
standards in this country? I believe it does.
  This is a chart that shows something about El Salvador. This was 
published some while ago:

       Jesus Franco, 14, has scars crisscrossing his legs from his 
     ankles to his thighs and more on his small hands. For more 
     than half of his young life, he's spent long days cutting 
     sugarcane. He has the machete scars to prove it and so do his 
     four brothers and sisters, age 9 to 19, all of whom work in 
     the sweltering cane fields of El Salvador.
       Jesus' story is repeated countless times across Latin 
     America where children even younger than he is are found 
     working in cane fields at subsistence wages. More than 17 
     million children between the ages of 5 and 14 are working in 
     that region.
       Sugarcane workers, including children, use machetes to cut 
     the hard, sharp stalks of thickly planted fields where there 
     is little room to maneuver. Children and family members said 
     cuts requiring stitches are common in the fields and many 
     more children suffer burns from the caustic fertilizer they 
     spread by hand.

  Thirty-three percent of the sugarcane workers in the fields of El 
Salvador are under the age of 18. Many children in El Salvador start 
working in sugarcane fields between the ages of 10 and 13, and the 
number of children between the ages of 5 and 14 working in Central 
America is 17 million.
  This is a young boy working in a sugarcane field in Central America. 
This is a picture of the living conditions for sugarcane workers in 
Guatemala. This is a picture of the type of injuries which children and 
adult workers sustain while cutting sugarcane. This photo is from Human 
Rights Watch.
  I do not know how much more evidence is necessary to understand what 
we are trying to do. The majority who believe in this trade agreement 
are trying to hook this country into a competition with other countries 
that have decided they can fire workers who want to unionize, that have 
decided even if they have labor rules they do not need to enforce them, 
that have decided it is okay to have 9-, 10-, and 12-year-olds in the 
cane fields hacking away with machetes, and those are the conditions 
under which we compete. That is what the majority, many in this 
Chamber, will say when they vote for this trade agreement. They have 
said it before repeatedly with trade agreements, and they are going to 
say it again today. In the face of all evidence to the contrary, they 
are going to say it again today. It is unbelievable to me.
  So last evening, when I got a little cranky and objected to unanimous 
consent requests and was walking around a little upset, I was upset 
because of this. This trade agreement, the Central American Free Trade 
Agreement, was negotiated over 1 year ago. It was not brought to the 
Senate floor, not brought to the floor of the House, not brought to the 
Congress at all. Do my colleagues know why? Because they did not think 
they had the votes in the House of Representatives. But I knew some day 
the President and the majority would say, ``We are going to vote on 
CAFTA,'' and they would wedge it in right in that little corner, right 
in that crevasse before we go home for a break.
  Next week, we are not in session. There is a Fourth of July break. 
Sure enough, last night, that is exactly what the majority leader did. 
I am sure White House instructions were to get this done.
  It has been over a year. We think we now have purchased enough votes, 
we have given up roads and bridges and dams, and we have enough people 
who are willing now to vote for this. So we are going to have this 
discussion, we are going to have it now, and it is going to be done 
before we go home for the Fourth of July recess, and we are not going 
to have a 2-day or 3-day discussion about real things that matter a 
lot.
  We are going to have a discussion about flag burning, I guess, I am 
told probably in the month of July. The flag is very important in this 
country. It is a symbol of America's patriotism and freedom. I would 
not ever make light of that, but I would say this: As disgusting as it 
is, and it is disgusting to see anybody desecrate an American flag, one 
might well be hard-pressed to find someone who has burned an American 
flag. Look at the label. It might well be made in China because much of 
our textiles come from China these days. The people who used to make 
those textiles--shirts and trousers and, yes, flags--used to be 
American workers, but now they are foreign. They are gone because we 
have a trade strategy that says we want American workers to compete 
with workers in China, Sri Lanka, Bangladesh, and Indonesia. Those 
workers will work pretty inexpensively. Those are workers who can work 
7 days a week, and we can ask them to work 12 hours a day. We can pay 
them 30 cents an hour and that will be just fine, and American workers 
cannot compete with that--that is tough luck.
  I happen to think that what we have built on this little planet 
called Earth, the only spot on Earth that is the United States of 
America, is extraordinary. One of the reasons it is extraordinary is we 
had the guts as a country, all of us did, both parties and people 
marching in the streets, to do what was right. We said there is a right 
way to do things and a wrong way to do things. One has capital, labor, 
and all of these things that come together to produce. Both have 
rights, both ought to be protected, and so people chained themselves to 
the White House fence, people died in the streets of Detroit, people 
manifested a belief and a passion that workers have the right to 
organize, they have a right to work in a safe work plant, they ought to 
have child labor laws, and companies ought not be able to dump their 
sewage and chemicals into the streams and into the air. We made a lot 
of progress doing that, so we have a better country because of it. We 
use much more energy now than we did 25 years ago, and we have a 
cleaner country.

[[Page 15055]]

  All of those things we have done to make this a better place in which 
to live, to allow jobs to be available that allow workers to provide 
for their families, are now being considered largely irrelevant because 
one does not have to bother with those things in production here at 
home. They can just produce elsewhere, and workers can be treated like 
a pair of pliers or a wrench: When you are done with it, just throw it 
away, just get rid of it, just leave it somewhere else. Do not worry 
about it because you can find another one 8,000 miles away. You can 
transfer the capital immediately, you can transfer the technology 
immediately and combine the capital and the technology with somebody 
who will work for 30 cents an hour. Do not worry about the consequences 
for the American workforce because if one is an international 
corporation interested in shareholder profits, they do not have to say 
the Pledge of Allegiance. So do not worry about that.
  Those are the values we ought to be talking about when we talk about 
these trade agreements, values long forgotten, in my judgment, during 
these debates, values that no one wants to discuss much. That is why we 
are here for 1 day on the Senate floor on an issue this important, just 
wedging it right in between now and the Fourth of July recess.
  As I close, I ask my colleagues to look at this one more time. This 
is a trade deficit chart that tracks the loss of American jobs and 
tracks the selling of America to foreign interests. Every single day, 
$2 billion of American cash, American assets, American real estate, 
ends up in the hands of foreign interests. It is what Warren Buffett 
means when he says that we as a country are headed toward a share 
cropper future. I defy anyone in the Senate to come to the floor and 
tell me this is moving in the right direction, tell me this is good 
news.
  This is a disaster. This is dangerous for our country. This is 
evidence of a Congress that refuses to stand up, that does not have the 
backbone, the will, and the strength to stand up for this country's 
interests and is not willing to stand up and say: ``I want to protect 
America's interests.'' Why will they not say that? Because they are 
worried that somebody is going to call them protectionists. Well, sign 
me up, for God's sake. My interest in putting on a suit in the morning 
and coming to work is to protect the economic interests of this 
country. Yes, I think we have a global economy and, yes, I think trade 
can be beneficial, but if trade agreements are not mutually beneficial, 
then this country has no business signing up to trade agreements that 
cost this country jobs and economic strength and cost us an opportunity 
for a better future.
  I will have more to say about a range of these issues later this 
afternoon, but I hope we will continue to hear from colleagues about 
the underlying premise of this set of failures and how we can turn it 
around. How do we turn it around? Every kid in this country who is now 
in school is going to have a future that is injured by this strategy 
unless we turn it around. Only we can do that. There is no one better 
able to do it than us, but we have to have the will to do it. I hope 
that perhaps at the end of the day, when we finally vote, we will find 
a will to quit moving in this direction and stand up for the economic 
interests of this country.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Idaho.
  Mr. CRAIG. Mr. President, I spent the last few minutes listening to 
my colleague from North Dakota discuss a very important issue for our 
country. While he and I have come to the same conclusion as to how we 
are going to vote on this issue, we have come from different points of 
view to arrive at I believe a similar conclusion.
  Mr. DORGAN. Might I inquire of the Senator from Idaho, my intention 
was to yield 10 minutes to the Senator from Idaho off our time. Is that 
the Senator's intention as well?
  Mr. CRAIG. I would ask that be done, if that is necessary. Ten 
minutes is clearly adequate. I need no longer than that.
  Mr. DORGAN. I yield 10 minutes to the Senator from Idaho.
  Mr. CRAIG. Since Congress gave the President fast-track trade 
negotiating authority in August of 2002, we have had to face the 
reality that comes with it. I supported giving the President that 
authority because clearly the executive branch is the branch that 
negotiates trade agreements.
  But while giving him that authority, I said that I would look at each 
trade agreement and study it thoroughly to determine whether I believed 
it was in the best interests of our country to approve it, and, as 
important, in the best interests of my State of Idaho. Three agreements 
have been reached and Congress has dealt with all three of them. I have 
voted for two of those three.
  The administration has been actively pursuing a vigorous bilateral 
and free-trade agenda around the world, and I believe it is in the best 
interests of our country, both economically and socially, to trade 
where we can, when we can, as long as it is fair and balanced and it 
recognizes all of the tradeoffs involved.
  Trade with foreign nations is a valuable component to promoting 
economic opportunities at home. This is not a one-sided economic 
playing field. If we were to produce only that which America consumed, 
then, working America, half of you go home. It is clearly in our best 
interests to trade and we know that.
  At the same time, we should not be trading off one segment of our 
economy against another. Trade agreements ought to be there to promote 
general economic growth in our country. Certainly it ought to be able 
to promote economic growth around the world. But in the end, when that 
trade agreement is struck and implemented, we ought to be able to say 
it serves all of America well.
  Congress is now debating, as we speak, the Central American Free 
Trade Agreement, otherwise known as CAFTA. I became involved with our 
trade negotiators as the President and our then-Trade Representative, 
Bob Zoellick, began negotiating with CAFTA nations. As an agricultural 
State, Idaho has a large stake in these agreements, and agriculture 
right now is currently learning how to restructure itself in our global 
markets to remain highly competitive, to supply not only food and fiber 
to America but to consumers around the world.
  As many know, a major agricultural crop in my State is sugar. Idaho 
is the second largest producer of sugar beets, behind Minnesota, in the 
United States. Idaho's sugar industry employs somewhere in the 
neighborhood of 7,000 to 8,000 people and generates nearly $800 million 
in economic activities in my State. The sugar industry of Idaho and in 
most other sugar-producing States has had to restructure itself in the 
last several years because of the unprofitability of it. Farmers have 
pooled their money, they have created cooperative processing plants to 
market their sugar, and so inherently have developed large personal 
investments in all levels of the production of sugar.
  It is well known that the world sugar market is one of the most 
distorted agricultural markets in the world and that most world sugar 
supplies are simply dumped on the markets at prices well below the cost 
of production. As the Senator from North Dakota was showing a few 
moments ago, some of that production is done at the lowest of costs and 
at a tremendous cost to human capital. U.S. producers already face an 
oversupply situation, with significant quantities in storage at the 
expense of the producer. Prices have slowly declined. Yet production 
costs in the United States have skyrocketed.
  Although the United States is the fourth largest importer of sugar in 
the world--no, we have not shut the world out, we are a very large 
importer of sugar--CAFTA seeks to significantly compound an already 
ugly situation and set a ``precedent of no return'' for further 
negotiations already underway with major sugar-exporting countries such 
as Thailand and Panama. In other words, this is not the last bilateral 
agreement this Senate will see before it that deals with the issue of 
sugar.
  CAFTA nations already enjoy duty-free quota access for sugar with the 
United States. I am not prepared to trade away an industry so vital to 
my

[[Page 15056]]

State to the overall well-being of some other country's sugar industry.
  Other Idaho agricultural groups understand that those farmers who are 
sugar producers also are potato producers and bean producers and grain 
producers. We are not just talking about impacting one commodity. We 
are talking about impacting a lot of commodities. If Idaho were to lose 
the acreage that it now commits to sugar, it would have to grow 
something else. It would put pressure on other commodities.
  We have sought and have obtained a relatively well balanced economy 
in agriculture. In my opinion, CAFTA will distort that. Our U.S. 
negotiators are willing to open our markets to increased sugar imports 
while other competitors maintain unfair economic advantages in domestic 
subsidies and minimal market access commitments.
  Myself, along with my colleagues from sugar-producing States, took 
our concern with CAFTA to the administration. With the help of my good 
friend and chairman of the Senate Agriculture Committee, Senator 
Chambliss, we met late into the night with our trade ambassador, Rob 
Portman, and with the Secretary of Agriculture, Secretary Johanns. I 
must say in all fairness to them they not only listened but finally, 
after well over a year and a half of me saying ``don't go there'' and 
then when they did, saying ``come work with us,'' they finally fully 
began to engage.
  They brought forth a proposal that, in my opinion, was not all bad. 
At the same time, it modified the 2002 farm bill, in large part, and it 
committed U.S. money to a program to save, if you will, or maintain, if 
you will, that we had told our Senators on the floor was going to have 
no net cost to the American taxpayer.
  As a result, while I thought it was a significantly improved 
proposal, the sugar industry of this country looked at it and looked at 
what they felt was a very weakened position because of CAFTA and 
because of NAFTA and because of what was happening in Mexico now and 
because of a position they would be placed in the 2007 farm bill 
negotiations, and they simply had to say no.
  Trade agreements ought not to be trading one industry off against 
another. These trade agreements ought not to have to come to Idaho and 
any other State and say: We have weakened the capacity of your State, 
or the agricultural industry of your State in this instance, to be 
competitive and to produce and to sustain ourself and your livelihood.
  It is for all of these reasons that I will be voting against CAFTA. 
However, I applaud this administration for their diligent and willing 
work with us on this issue. In the final hours, they tried. The problem 
is, they didn't try a year ago, or 2 years ago, when this issue was 
being negotiated. More than once I sat down with Ambassador Zoellick 
and said: Don't touch sugar. It has a very static market today. It is 
in a highly competitive market. And it will be most difficult for that 
industry to sustain itself, let alone sustain itself in a diminishing 
market environment.
  They didn't listen. We have CAFTA. Anybody can waive two little 
packets of sugar around and say that is all it is about.
  But what about the Colombian agreement? What about the Thailand 
agreement? What about the Panamanian agreement? What about the South 
African agreement? All are sugar-producing nations. All are ready to 
sit down and negotiate and ask for a piece of the U.S. sugar market. 
That is why the producers in Idaho and around the Nation, when provided 
this last moment agreement, simply had to say no. They are placed, by 
this agreement, in a most difficult situation. As a result, in my 
support of them, I will oppose.
  Again, trade agreements ought not be about trading one segment of our 
economy off against another, trading winners and losers, and therefore 
creating an environment that pits one head to head with another. That 
is unfair. Our Government ought not be doing that.
  While there are many benefits to be gained by CAFTA, there are 
winners and losers. I believe the sugar producers of this Nation become 
losers. I have to vote no.
  The PRESIDING OFFICER (Mr. Chafee). The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I rise to make a unanimous consent 
request on the order of speakers to be recognized: Senator Kerry for 20 
minutes, and that is from the time of Senator Baucus; Senator Inhofe, 
for 15 minutes from my time; Senator Bingaman, 8 minutes from the time 
of Senator Baucus; and Senator Brownback for 10 minutes from my time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Massachusetts.
  Mr. KERRY. Mr. President, it is interesting, listening to the Senator 
from Idaho, who, as he said, came to this decision from a different 
place than the Senator from North Dakota, and listening to the Senator 
from North Dakota; both of them have raised issues they tried to get 
the administration to respond to. I am very sympathetic with the sense 
they have that the administration just didn't respond to them and 
really was unwilling to try to accommodate what I think are very 
reasonable concepts.
  In May of 2003 I sent a letter to Ambassador Zoellick, asking the 
administration to delay tabling CAFTA's labor chapter until Congress 
had an opportunity to consult. I wrote again in October 2003, raising 
similar concerns.
  All we got was a very sort of abrupt and short letter that basically 
never engaged in the kind of discussion that could have benefited all 
of us so we would not have the kind of divide we have in the Senate and 
in the country today.
  During the debate of TPA in 2002, I offered an amendment to allow 
communities to be able to preserve their health and safety laws which 
were being challenged under NAFTA. Even now, with a lawsuit pending 
against the State of California for attempting to protect their 
drinking water--imagine that. The State of California wants to protect 
its drinking water and the interests of its citizens. But nevertheless 
they included the very same provisions that have led to that kind of 
challenge in CAFTA.
  In the summer of 2003, I suggested to the administration, in the 
context of the Chile and Singapore agreements, that the labor standards 
achieved in those agreements would not be adequate for CAFTA. The 
reason for that is in Chile, in Singapore, and in Australia--all three 
agreements which I supported last year--you have capacity for 
enforcement. You have specificity with respect to the laws on the books 
that can be enforced. And you have a record of that enforcement. All 
three of those ingredients--capacity, specificity of law, and record of 
enforcement--are absent in too many of the countries that are involved 
in this agreement.
  We tried to get the Trade Representative to understand that there is 
an evenhanded way to open a fair agreement to trade but to address 
those kinds of concerns. Regrettably the labor standards in the Chile 
and Singapore agreements may be good for those countries, but they 
should not be applied to CAFTA because of the lack of those three 
critical ingredients.
  Even in this last month, as CAFTA was considered in the Senate 
Finance Committee, I offered an amendment that specifically laid out 
what the administration could do to fix this agreement. That amendment 
lost on a tie vote--10 to 10 was the division in the Finance Committee, 
in no small part a division that was that close because the 
administration opposed it.
  So I regret enormously that we are where we are with respect to this 
agreement at this point in time. I have been in the Senate now for 21 
years, and I was one of those who was on the cutting edge and leading 
the effort in our party to try to make it clear that we ought to trade 
and that it is important to the United States. I still believe that. I 
voted for NAFTA, the Uruguay Round, China PNTR, and the many bilateral 
agreements negotiated by both the Clinton and Bush administrations.
  Last year, while I was not here to vote, I supported the Chile, 
Singapore, and Australia agreements precisely for

[[Page 15057]]

the reason that they had a strong ability and a strong record of 
enforcement, that they had very specific laws, and that they had the 
capacity to be able to enforce those laws.
  There are some colleagues who have always opposed each and every one 
of these trade agreements; and there are some who have been for 
everything no matter what the balance is. For a number of years now I 
have been trying to suggest not as a matter of ideology, not as a 
matter of party label, because I don't think this should have a party 
label, but as a matter of common sense, I have been trying to suggest 
that the consensus we have built globally for trade, a consensus built 
around the notion that, yes, there are some winners and losers, but you 
do your best to mitigate the impact on losers, that you have sufficient 
trade adjustment assistance, that you do enough education and training, 
that you do enough with health care and COBRA payments so people can 
cover themselves with health care during a transition, that you ease 
the pain, so to speak.
  At the same time, as you attempt to maximize the rising of all boats 
in the tide that we proverbially think about, the rising tide lifts all 
boats, the fact is, in many countries, it is not lifting all boats. The 
standard of living does not move at the rate it ought to. The standards 
for health, safety, labor organizations, or environment do not change 
in the way they ought to. All of these are quality-of-life issues and 
value issues, fundamental value issues that ought to be part of our 
agreements.
  This is not just basic economics. Particularly when you look at the 
chart showing the deficits in trade that are growing, it is hard to 
make a new economic argument about it. The fact is there are larger 
issues at stake in a trade agreement.
  For rigid ideological reasons, over the years, we have had tension in 
the Senate and a fight over whether you embrace some of these other 
considerations in a trade agreement. Part of the reason we have had 
such intense reactions to trade meetings around the world, with riots 
in Seattle and with other demonstrations around the globe, is because 
of the raging pace of globalization and the discomfort it brings to a 
whole bunch of people who feel powerless to be able to do something 
about it. If we, the people who have the power to do something about 
it, do not choose to do so, we leave people out in the cold and hurting 
even more.
  The fact is, the consensus--which has been global, that has helped us 
to be able to build the trade structure--is fraying. It is fraying not 
just in the United States but it is fraying in other countries as well. 
The administration had a unique opportunity in this agreement to try to 
address some of those concerns. We all understand that opening markets 
sets in motion economic transition that everyone here knows creates 
winners and losers at the same time.
  While you may want to mask some of that impact, the personal impact 
to people's lives with an unemotional language of economics in the 
Senate, the fact is if you go to Ohio, Wisconsin, Minnesota, Idaho, 
North Dakota, or other parts of the country, it is having a profound 
impact on communities. It is having a profound impact on the fabric of 
life in America and on our ability to be able to have a long-term 
strategy for success.
  We all know the numbers. Since 2001 we have shed nearly 3 million 
manufacturing jobs. We have endured 42 consecutive months of economic 
decline in the manufacturing sector. Fifteen years ago, 20 years ago, 
30 percent of America's economic pace was services and 70 percent was 
manufacturing. Today, it is 30 percent manufacturing and 70 percent 
services. Many of those services are not the kind of high value-added 
paying jobs Americans have come to expect.
  We have long understood if we want a broad consensus for free trade 
in America, we have to make these trade agreements work for all 
Americans, not just for the winners, but for the people who temporarily 
are in the losing position.
  In the 1990s we began to respond to that. First we looked at the 
trade agreements themselves and we decided we must protect American 
workers from unfair competition. American workers should compete on the 
basis of pay and skill and effort. But it is unfair, fundamentally 
unfair, to ask Americans to compete against child labor or against 
habitually depressed wages or habitually unfair working conditions.
  In the Jordan agreement of 2001, President Clinton had come to 
understand that in the later part of the 1990s. His administration 
moved specifically to include these other values within the four 
corners of a trade agreement. We gave basic labor protections the same 
standing we give in the protections we provide to corporate America. In 
other words, we made a new bargain with the American worker in order to 
hold on to the consensus. The bargain was very simple: We will protect 
your economic interests, your job from unconscionable competition such 
as child labor, just as we protect a corporation's economic interests, 
which are its product, from dishonest competition such as copyright 
theft. It seemed like a very fair bargain, a very fair form of 
protection.
  In CAFTA, we go backwards from that standard. We go backwards from 
that standard for no explicable reason. Once again, our corporations 
get the protections they need with an elaborate system of rules, 
complaints, appeals, compensation, and strict enforcement. But all our 
workers get is some flowery language with no teeth behind it.
  We are going to hear that CAFTA has the strongest labor provision of 
any trade agreement. That is what some folks have been trying to say. 
Look at this agreement, read the language, and you realize that is once 
again spin. It comes down to this: There is only one labor provision in 
CAFTA that is enforceable. It is a nation's commitment to ``enforce its 
own laws.'' Now, that sounds good, or it sounds like something, but in 
reality this provision does nothing to protect workers because, No. 1, 
there is no stipulation whatever as to what those laws are; No. 2, some 
of those laws are completely inadequate; No. 3, there is no enforcement 
capacity in some of those countries to enforce even the inadequate 
laws, if you can understand what they are. There could have been a 
stipulation as to what they are. There could have been an understanding 
in the four corners of this agreement as to what standard we would try 
to reach.
  Moreover, if the provision does lead to an attempt at enforcement, 
guess what. The maximum so-called penalty is $15 million. There is a 
cap. There is no cap on the corporate penalty. But there is a maximum 
cap. Guess what. It is a so-called penalty because the fine is then 
returned to the offending country, ostensibly, to be used to fix the 
problem, but without any real enforcement mechanism to do so.
  Senator Bingaman will say to the Senate that he has secured an 
agreement from Trade Administrator Portman that they will put $40 
million a year into the enforcement efforts. Again, if you do not have 
adequate laws and you do not have adequate specificity and you are 
enforcing in a structure that has a cap on the payment and the payment 
goes to the country that offended, you are not enforcing the standards 
of workers.
  There is another labor provision in CAFTA. It asks a nation to strive 
to eliminate ``the worst forms of child labor.'' We do not even define 
what the gradations of the forms of child labor are. Just the worst 
forms of child labor. There shouldn't be any form of child labor. But 
we are only going to seek to strive to get rid of the worst forms, 
sweatshop conditions and other problems.
  But if a nation fails to do that, we can only consult. In other 
words, we can talk about ending child labor in a CAFTA country, but we 
cannot take any action to end child labor in a CAFTA country. That is 
wrong. That is contrary to the values of our country and to the 
fundamental values of American workers. Words alone are not going to do 
anything for kids who are suffering in work sweatshops. They

[[Page 15058]]

will not do anything for the American workers who lose their jobs as a 
consequence of being undercut by that level of competition.
  I ask my colleagues to answer a simple question: Why is there a 
double standard that we are going back to when we passed an agreement 
that set a higher standard, and there is no showing as to why that 
standard hasn't worked, shouldn't work, and shouldn't be part of this 
agreement? Why do Americans not have the same standing as a 
corporation? Why don't they have the same standing to end child labor 
or sweatshop conditions that corporations have to go out and protect 
copyright or patent theft? Why the double standard that punishes 
American workers?
  I share with many of my colleagues a longstanding commitment to the 
development of the well-being of Central America, but I am concerned 
that CAFTA is insufficient to provide for steady and balanced economic 
growth in the region. The administration claims supporting CAFTA is a 
security issue. I agree, it is a security issue. It is about the 
economic security of some of the more vulnerable economies in our 
hemisphere. We have to ensure that a trade agreement with Central 
American countries grows their economies, protects their workers, helps 
them preserve their sensitive ecosystems, and, most importantly, 
encourages balanced and widespread economic growth and opportunity for 
all of the people in the region.
  The most troubling aspect of CAFTA is that its shortcomings, 
particularly the administration's indifference to our own workers, are 
part of a larger problem. I will speak about that for a minute. What 
CAFTA underscores is the need for a national policy to make sure 
America is competitive, the leader in the global economy of today and 
of tomorrow. The reality is, there is no comprehensive strategy to meet 
the needs of a fast-changing playing field.
  What am I talking about? Certainly when we negotiate trade deals with 
nations that have an insufficient or lackluster labor record, you have 
to give citizens the same standing to be able to end child labor that 
corporations have to end copyright and patent theft. It seem to me it 
is a pro-trade, free-trade policy that builds consensus and which 
considers all Americans. But it was refused in this agreement.
  After you have the agreement in place, we need to defend America's 
interests. This is true of all of our agreements. The administration 
has to stop giving in to competitors. The Clinton administration 
brought an average of 11 trade cases to the World Trade Organization 
per year. This administration has brought a total of 12 cases in the 
first 4\1/2\ years.
  The administration also needs--and many colleagues have spoken about 
this--to take action against China's currency manipulation. We keep 
hearing about it. People talk about it. And they talk about it. And 
they talk about it. And they talk about it some more. The Senate has 
actually voted and gone on record that the administration needs to do 
something other than talk. But nothing has happened.
  In the administration's recent dealings with China, according to our 
trade representative, counterfeiting and piracy in China are at 
epidemic levels. That piracy costs U.S. companies $20 to $25 billion 
annually. We are told the problem is getting worse, not better. 
According to press reports in May, the United States presented the 
Chinese with a list of modest proposals to curtail intellectual 
property violations. Modest proposals. We gave them a list. The Chinese 
rejected the proposal outright.
  What did the administration do? They did not respond by pressing the 
Chinese. They did not respond by taking any particular action. Guess 
what they did. They told United States companies to go file lawsuits in 
Chinese courts to defend their rights. It is insulting and it is 
ridiculous. It is not just putting the agreements in place, it is also 
enforcing them that the American worker is asking for.
  In addition to that, we have all heard about the Chinese firm 
recently seeking to purchase Unocal, an American energy company. What 
many people do not know is that Chinese company borrowed money from the 
Chinese Government in order to make the bid. It should not come as a 
surprise since it is 80 percent Government owned. That has upset a lot 
of people and generated a lot of press. But it ought to concern us even 
more that we are doing the same thing in the United States in the 
following way. Since the start of the Bush administration, the Federal 
Government has borrowed billions of dollars to fund our national debt 
and cover questionable and, some think, even reckless tax choices in 
fiscal policy. Billions of dollars have been borrowed from--guess 
where--none other than the Chinese Government.
  Mr. President, I yield myself an additional 5 minutes off their time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KERRY. Mr. President, we ought to be concerned about the missed 
opportunities that are related to trade adjustment assistance. The 
Senate has supported trade adjustment assistance. If people lose their 
jobs, they have the right to expect that we are going to try to help 
transition. We have done that because we have understood the movement 
to open markets means this economic transition.
  Guess what. Once again, the administration has ignored the will of 
the entire Finance Committee on this issue, which voted to include TAA 
for service workers in the CAFTA agreement. In the Commerce Committee, 
Senator Ensign held an excellent hearing on America's competitiveness. 
Our witness was the administration's point person on manufacturing, Al 
Frink. He told us he believes there is a shortage of skilled workers in 
America. And that shortage of skilled workers is hurting our economy.
  What the Under Secretary did not say, or maybe he did not know, is 
that the Bush administration has resisted congressional efforts to fund 
worker retraining and vocational education, which would, in fact, 
address the skilled worker shortage.
  The administration's indifference to competitiveness goes deeper. We 
have a tax policy that rewards American and multinational companies for 
housing operations abroad instead of housing them here in the United 
States. It is hard to imagine a more backward tax policy. We should end 
it. But for this administration, it is not only not a priority, it is 
not even an afterthought.
  We also do not adequately fund the basic science and research that 
will produce the revolutionary technologies and products of tomorrow. 
Not surprisingly, fewer and fewer American students are choosing to 
study science and engineering. The Bush administration has proposed 
cutting Federal research and development spending for the first time in 
10 years. The story is much the same in our public schools. Bill Gates 
has called our high schools obsolete because they fail to prepare our 
kids to compete. Alan Greenspan said much the same thing before the 
Finance Committee last week. Yet every year the administration refuses 
to fully fund No Child Left Behind, seeming perfectly content to see 
those kids not study science and engineering, or perhaps not study at 
all. And all of this time, the administration negotiates trade deals 
that remain indifferent to American workers and fail to defend our 
legitimate interests at home, all the while refusing to adequately 
invest in science, research, training, and ignoring the problems that 
drain our businesses, such as health care.
  The competition is hard at work at every single one of these. China 
and India will probably turn out 300,000 engineers each over the next 
year--way ahead of the United States. While our shortsighted policies 
stunt our competitive advantage, China, India, and all of Asia and 
Europe have developed long-term investment plans, long-term 
infrastructure investment plans, long-term trade, and long-term 
educational plans, all aimed at one thing: eliminating America's 
economic dominance. They have national programs aimed at educating 
workers, reducing capital costs, and attracting businesses. And we are 
falling dangerously behind.
  I was visited just the other day by the new president of MIT. Every 
Senator here, I know, respects that institution. She was deeply 
concerned. She

[[Page 15059]]

expressed this enormous concern about what is happening to the 
competitive advantage of our great science and technology institutes 
across the country and our commitment to science as a whole as a 
Government.
  In the Commerce Committee, we heard how Japan and the European Union 
are implementing large-scale, long-range R&D projects aimed at 
developing leading-edge commercial technologies. For example, from 1995 
through 2001, the emerging economies of China, South Korea, and Taiwan 
increased their investments in research and development by 
approximately 140 percent.
  It is urgent we consider real measures to advance America's 
competitiveness and forge a new global consensus on trade in our 
country. That global consensus begins with a set of rules that makes 
sense to the American worker, rules that work for the American worker, 
even as we open new markets, which we must do.
  We can do better than this trade agreement. We need to.
  Mr. President, the bottom line is that CAFTA is not a good deal for 
America. It is a good deal for some companies. It is a good deal for 
some investors and shareholders. It is a good deal even for some of the 
countries that are a party to it. But it is not a good deal for the 
American worker. So I hope colleagues will help America stay at the 
top, while making trade fair for Americans. And I hope colleagues will 
join in saying no to this agreement in its current shape.
  Thank you, Mr. President.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. INHOFE. Mr. President, I think under the UC I have been allocated 
around 15 minutes. I ask unanimous consent to be granted such time as I 
shall consume.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. INHOFE. Thank you, Mr. President. I think I will be able to do it 
within that time, anyway.
  Let me make a couple comments. I think almost none of these items 
have been covered before. It is approaching this whole CAFTA idea from 
a different perspective.
  Let me first of all say that when this first came up, I just heard 
``CAFTA,'' and I said: I am against it. I led the opposition against 
NAFTA 11 years ago. I thought this was more of the same, and so I was 
opposed to it. Then someone showed me how my Oklahoma farmers might be 
affected.
  I am not sure you can see this chart, but it shows the various 
grains, cattle, meat products, dairy products, vegetables, and so 
forth. The blue bars are the tariffs that are charged to our farmers, 
and the others are what are charged to imports coming in. I have found 
that in every case, when this is fully implemented--if it is--my 
Oklahoma farmers will benefit, and benefit materially.
  So I actually went and talked to some of the farmer groups that were 
leaning against the agreement for a number of reasons--a number of 
reasons that have been posed on this floor--only to find out they have 
changed their minds and they are very much supportive.
  That is not really why I am here today. I think that is something 
very specific we can look at. We know it is true. I would like to look 
at this in a little different way. I was distressed a little bit 
because some of my very good friends in the conservative communities 
were opposing CAFTA. I have gone to any lengths to try to determine 
specifically what their opposition was.
  There are five organizations that are conservative organizations--
they are great organizations. I agree with them almost 100 percent of 
the time. Their argument was: We are against this as we are against all 
treaties because anything that is this kind of a multinational thing 
will infringe upon our Nation's sovereignty.
  Well, I have to tell my good friends in these five conservative 
organizations, there is no one who is stronger in this position than I 
am. I am the guy who stopped the Law of the Sea Treaty. Quite frankly, 
I think it was going to pass. It actually had passed out of the Senate 
Foreign Relations Committee with a unanimous vote. I found out what was 
in it. I found out we were ceding our jurisdiction--our sovereignty, if 
you will--over some very important parts of the water-covered part of 
the planet. I felt it was wrong. And we have not--I am not saying it is 
all dead in the water right now, to use a phrase, but I think it is. 
Certainly it has been stalled. I led the opposition. I was opposed to 
it. I was not for it.
  The Kyoto treaty, you all know how I feel about that. We debated 
climate change on the Senate floor 2 weeks ago. I spent 2 whole days 
talking about that. I think we know that under that treaty, according 
to the Wharton Econometrics Survey from the Wharton School of 
Economics, if we had to comply with the Kyoto treaty, it would have 
cost our average family of four $2,700 a year. It would have doubled 
the price of energy and gasoline and all that. We know that is true. I 
led the opposition to that and was very proud to do that.
  Eleven years ago, we had NAFTA. I was in the other body, in the House 
of Representatives, 11 years ago. I was elected in a special election 
to come over to this body. So the year they had NAFTA, I was able to 
lead the opposition to the ratification of NAFTA in both the House and 
the Senate. I was the only one who could do that. So I came over here 
to the Senate.
  I say to my good friend from North Dakota, who posed some excellent 
arguments against NAFTA just a few minutes ago, this CAFTA is not 
NAFTA. On the NAFTA part, I agree. I remember standing on the floor of 
both the House and the Senate saying: If we pass NAFTA, that is going 
to allow a Mexican trucker to pick up a load in Brownsville, TX, take 
it to Tulsa, OK, and not have to comply with any of our health 
standards, our environmental standards, our wage and hour standards. 
Sure enough, these things turned out to be true. I do not think it was 
a success. I think it was a failure.
  So getting back to the ones who are for this agreement and against 
it, I would have to say to the very small number of conservative 
organizations that are opposing this, the vast majority of the 
organizations in the conservative column are supporting it.
  Listen to this. Those organizations that are supporting CAFTA include 
Americans for Tax Reform, Center for Security Policy, National Tax 
Payers Union, The Heritage Foundation, David Keene of the American 
Conservative Union, Citizens Against Government Waste, Competitive 
Enterprise Institute, Oklahoma Council of Public Affairs, The Club for 
Growth, the National Tax-Limitation Committee--that is Lew Uhler and 
his group--Citizens for a Sound Economy, Empower America, and the James 
Madison Institute. That is just to name a few. They are the 40 most 
prominent--except for 5--organizations that are supporting it.
  I am very sensitive to this. Maybe I should not be that sensitive, 
but I am because, according to the American Conservative Union, in 
their rating, I am not No. 2 or No. 3 or No. 4 but the No. 1 most 
conservative Member of the Senate. Now, I am qualifying myself for this 
because I keep hearing that conservatives are somehow opposed to this 
agreement, as they were NAFTA. Of course, I agreed with them back at 
the NAFTA time.
  Now, what kind of liberal groups are opposing CAFTA? We have already 
talked about the conservative groups that are supporting CAFTA. Those 
who are opposing it are Earthjustice, National Environmental Trust, 
Friends of the Earth, EnviroCitizen, Freedom Socialist Party--there is 
another great group--the Berkeley Fellowship of Unitarian 
Universalists' Social Justice Committee, Nonviolence International, 
Progressive Democrats of America, Safe Earth Alliance, Public Citizen, 
Social Welfare Action Alliance, Community Alliance for Global Justice, 
Gray Panthers of Austin, San Francisco Neighbor-to-Neighbor, New York 
State Green Party, and the Holland Peacemakers. I could go on and on. 
And we will insert more of them in the Record.
  But by and large, what I am trying to get across is that virtually 
every far-

[[Page 15060]]

left, extremist, liberal group in America is opposing CAFTA. And 
somebody has to say it. I was sent an e-mail from my State of Oklahoma 
saying that they understood I was still undecided. The responses are 
about 9 to 1 in opposition to CAFTA, and, therefore, you cannot dare go 
ahead and support CAFTA.
  Let me just say, on many occasions, when the people at home do not 
have available to them the information that we do because that is what 
we are paid to do for a living and we find out the information is 
wrong, I do not mind doing that. I can explain this to the people in my 
home State of Oklahoma. They do not want to identify themselves with 
that group, that liberal group I just read off. And when they find out 
about it, they will be very supportive.
  But I only bring that up to say that if anyone is out there with the 
thought that this is a conservative versus liberal issue, it is, but it 
is on the other side. The liberals are opposed to it. The conservatives 
are supporting it.
  But I have another concern that is far greater, that far outweighs 
even the benefits it might give to my farmers in my State of Oklahoma, 
even the benefits that would be achieved by passing this to the very 
conservative groups in America; that is, I happen to be old enough to 
remember what happened in the 1980s. I remember Ronald Reagan, a great 
President. I remember at that time we had Communist regimes in Grenada, 
El Salvador, Nicaragua, and Costa Rica, and that they were 
infiltrating--at that time, it was still the Soviet Union--they were 
trying to take over America by doing it through Cuba, and then all 
these organizations, all of these countries where they had taken over 
the government.
  By failing to pass this treaty, we could undo all of those successful 
democratizations of the Reagan and the first Bush administrations. I 
remember the Contras, the freedom fighters, who were down in Nicaragua 
at that time, and the fight that was almost impossible; they were 
fighting for their freedom. I remember those five countries that are 
part of this treaty: the Dominican Republic, El Salvador, Honduras, 
Nicaragua, and Costa Rica. They have all committed troops in support to 
the Iraqi coalition forces and have demonstrated their support for the 
global war on terrorism. They are fighting side by side with our troops 
over in Iraq and Afghanistan. These are the people we want to reward. 
These are not people we want to somehow punish, as though they have 
done something wrong. They are fighting for freedom.
  CAFTA approval for these countries and their economies should aid 
security there and counter the influence by Cuban and Venezuelan 
Governments under Castro, Chavez, Ortega, and others opposed to the 
United States influence in the region.
  I mentioned Chavez, Ortega, and Castro. They are among the anti-U.S. 
forces in the region, and they are all against CAFTA. These Communists, 
these enemies of the United States, Chavez, Ortega, and Castro, are all 
in opposition to CAFTA. If you want to be on their side, you would vote 
against CAFTA. They fear its passage would show support for and 
facilitate the efforts of the pro-American countries and parties in the 
region. Also, Daniel Ortega, former Nicaraguan president and Sandinista 
leader, is making attempts to elevate his obsolete ideology based on 
Marxist-Leninist theory. Further, upon his capture, Ortega expressed 
solidarity with Saddam Hussein against what he called the Yankee 
occupiers of Iraq. In other words, here is a guy who has been ousted as 
President of Nicaragua, one we defeated back in the 1980s, one who was 
trying to spread communism against freedom and democracy in Latin 
America. He was on the side of Saddam Hussein and called us the Yankee 
occupiers of Iraq.
  A couple weeks ago I had a pretty bitter competition with one of my 
friends here in the Senate from Arizona, Senator McCain. I disagreed 
with him on an issue, and we spent 2 days debating that issue and 
fighting with each other. I have to say that I wholeheartedly agree. I 
happened to hear some of his remarks a few minutes ago. I share his 
concern about the state of democracy in Central America. Failing 
economies will create an environment in which regimes such as those of 
Fidel Castro and Hugo Chavez may once again poison the future of these 
nations. The historical threat of communism in Central America, the 
influence of Castro in countries such as Nicaragua, and the Sandinistas 
in power also affected neighboring countries such as Honduras and El 
Salvador. CAFTA can protect these emerging democracies.
  For example, Nicaragua, the second poorest country in the Western 
Hemisphere, second only to Haiti, has a President Enrique Bolanos. He 
is a pro-American President. He is facing a tough 2006 election, and 
the candidate he is facing is none other than Daniel Ortega. Bolanos 
knows that CAFTA is the keystone to his plans to boost economic growth 
and blunt the political attacks of the Sandinistas. Who would have ever 
thought in the last 10 years that they would reemerge, but they have. 
So now we have Daniel Ortega back there trying to do some things. To 
quote Senator McCain:

       If there's anything that we need today, it is strong, 
     viable economies in Central America so that they can 
     progress, so that they can be strong and they can again be 
     allies of the United States of America, not in a military 
     fashion but in their advocacy for free and open societies, 
     democracies, and places where people can raise their families 
     in a situation of security and peace.

  That is what Ronald Reagan did back in the 1980s.
  I heard the junior Senator from Massachusetts speaking in opposition 
to the agreement. I don't know whether it is because of his past 
relationship with what was going on down in Nicaragua some 12 or 14 
years ago, but I would like to quote from an April 26, 1985 edition of 
the Washington Post. Keep in mind, this was back when we had Daniel 
Ortega down there being promoted by Castro and by the Soviet Union to 
try to spread communism in Central America.

       The lengths to which some Democrats were willing to go in 
     pursuit of nonintervention were extraordinary. Sens. Tom 
     Harkin and John Kerry returned home from an 11th-hour trip to 
     Managua [Nicaragua] clutching a piece of paper signed by 
     President Daniel Ortega which they announced was a ``new, 
     bold and innovative approach'' and ``a wonderful opening.'' 
     At their arrival home, only the umbrella was missing.

  We have a difference of opinion. We don't agree. We didn't agree back 
in the middle 1980s about Daniel Ortega and what the Communists were 
trying to do in Central America and we don't agree today.
  For those who weren't around at that time, it was a very emotional 
time. The contras were the freedom fighters. They were supposed to win. 
I used to go down there. There was a hospital tent that was right 
across the border in Honduras. That is where they would take the 
freedom fighters from Nicaragua. They would take them over there to 
treat them. This tent was about the size of this Senate Chamber. It had 
beds all around the periphery. In the middle, not even screened, was 
the operating table. The only operations they performed there were 
amputations because of all the mines that were there. And so these 
freedom fighters would come in there and be mended and go back and 
fight for their freedom across the border in Nicaragua. There must have 
been 40 beds all the way around, people who had had these amputations.
  At that time I did a pretty good job of speaking Spanish. I thought, 
you kids--the average age was 16 years old because the older ones had 
already been killed--you kids are fighting for your freedom, you are 
fighting against this force, the Communists, supplied by Castro and the 
Soviet Union. It is impossible. Why are you doing this? And I went 
around and talked to each one of them. I remember coming up to a little 
girl who was 15 years old. Her name was Elena Gonzales. I asked her 
that question. And she looked up to me. It was her third trip back to 
that hospital tent, and they had amputated her right leg a few hours 
before. The blood was coming from the bandages. She looked up at me 
with teary brown eyes and she said:
  Es porque han tomado nuestros campos . . . han tomado todo de lo que

[[Page 15061]]

tenemos. Pero de veras, ustedes en los Estados Unidos entienden. Porque 
ustedes tuvieron luchar para su libertad lo mismo que estamas luchando 
ahora

       (English translation of the above statement is as follows:)

  Yes, it is almost impossible, but we are fighting. We are fighting 
because they have taken our farms and ranches. Why would you in the 
United States question why we are doing this? You had to fight against 
the same odds for your freedoms as we are fighting now.
  That little girl didn't know whether the Revolutionary War was 200 
years ago or 20 years ago. But she knew we were that beacon of freedom 
and that the beacon was about to go out in their country. They were 
willing to fight. And they died and they won. So now we have the rest 
of the story.
  This is an opportunity for us to do something that is good down 
there. Yes, I think it is good for my Oklahoma farmers. And yes, the 
conservatives support it, and the extreme liberals oppose the CAFTA 
treaty. But I think the strongest argument is that this is an 
opportunity for us to keep the Ortega and Chavez and Castro forces from 
undoing all the progress that was made throughout the 1980s and the 
early 1990s.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, I yield myself 8 minutes off the time on 
this side.
  I want to speak briefly about the CAFTA agreement. I start from the 
proposition that increased trade with the international community can 
advantage us, and it also can advantage those with whom we trade. Most 
of the trade of these countries that are covered by this CAFTA-DR 
agreement, most of their trade, over 70 percent of their trade, is, in 
fact, with the United States. It is very much in our interest that that 
circumstance remain the case. It can benefit us, and it can benefit 
these countries to see that trade increase. And it is very much in our 
interest, not only to strengthen our own country's economy but to see 
the economies of this region strengthened.
  This trade agreement comes at a time when our trade imbalance with 
the world is enormous. It is the largest in the history of our country. 
It is the largest in the history of any country in the world. 
Unfortunately, it is continuing to grow. As far as I can tell, our own 
Government has no strategy to deal with that problem. We have no 
strategy to promote investment in the United States. We have no 
strategy to promote the building of productive capacity or to keep this 
country competitive in the global economy.
  I hope very much that the Finance Committee, which I am privileged to 
serve on, can play a role in developing such a strategy over the next 
few months. When we had the markup of this legislation yesterday, I 
discussed that with Senator Grassley and Senator Baucus. It is my hope 
they will be able to schedule some hearings to begin understanding this 
issue better and helping us to craft a set of proposals to help deal 
with the very real problem we have in global trade.
  That being said, when I look at the provisions of this DR-CAFTA 
agreement, I do not see them contributing significantly to that trade 
imbalance. These are countries that have exported over 85 percent of 
what they send to the United States duty free. They have done that 
since the implementation of the Caribbean Basin Trade Partnership Act 
in 2000, and before that they were shipping most of their product into 
the United States duty free under the Caribbean Basin Initiative. The 
main effect of this agreement we are now debating will be to phase out 
and eliminate tariffs that they currently impose upon our products that 
we are exporting to them.
  I don't see the basis for the claim, which I have heard on the Senate 
floor and from others around the country that this agreement will 
result in the further export of jobs from the United States to Central 
America. The reality is that U.S. companies have many options about 
where to build their next plant, where to manufacture the products that 
they sell. Central America has been one of those options for a very 
long time. There is nothing I know of pending here in the Congress that 
would change that circumstance. In my view, this agreement would not 
change that circumstance as well.
  I would hope and expect that if this agreement is implemented, as I 
expect it will be, we will see the encouragement of more investment in 
productive capacity in Central America, but at the same time, as our 
exports to that region increase, we will see more investment in 
productive capacity here in the United States.
  There are clearly some problems with this agreement. Many of those 
have been pointed out. I don't suggest I have answers for all of those, 
by any means. Two of the problems that have particularly concerned me 
are, No. 1, the serious lack of attention to the enforcement of worker 
rights in these countries and, secondly, the inadequate provision of 
assistance with regard to the negative impacts that U.S. exports of 
agricultural product into that region may cause.
  Let me talk first about enforcement of worker rights. I have urged 
the administration to commit resources to this as a priority. It is not 
reasonable to require U.S. producers and workers to compete with 
foreign producers who do not afford their workers certain basic rights. 
To begin addressing this issue, Ambassador Portman, our trade 
representative, has assured me the administration will propose and will 
support funding for worker rights enforcement to the extent of $40 
million per year for fiscal years 2006 through 2009. Second, on 
monitoring of compliance with the various requirements on worker 
rights, there is a need for an independent and transparent monitoring 
of the treatment of workers in these countries. I have urged the 
administration to fund the International Labor Organization, or ILO, 
headquar-
tered in Geneva, to conduct ongoing monitoring on worker rights in 
Central America. This would include reports that they would publish 
every 6 months beginning when the agreement goes into effect and 
continuing to the end of the 2009 fiscal year.
  The administration has agreed to commit $3 million per year to 
accomplish that task. That $3 million would come out of the $40 million 
per year in funding that they are otherwise committing for enforcement 
of worker and environmental rights.
  I believe both of these commitments--to worker rights enforcement and 
the commitment to ILO monitoring--should be a part of all trade 
agreements that we have with developing countries. In addition, of 
course, I hope that the actual commitment to workers' rights standards 
in the language of the treaties, in any future treaties we sign, will 
be stronger than we find in this agreement. I believe it is also 
incumbent upon us to urge the next administration, after President Bush 
leaves office, to continue with these same commitments in the future.
  The other issue I mentioned is agricultural assistance--adjustment 
assistance for those working in the agricultural sector. I have also 
urged the administration to commit resources to allow subsistence-level 
farmers to make a transition without undue dislocation problems. This 
should help reduce the problem of dislocation of workers in these 
countries and the additional illegal immigration to the United States 
that likely would result if that dislocation occurs.
  Again, the administration is committed to provide increased support 
to address this issue. The level of funding is not what I would like it 
to be, but if these countries do receive funding under the Millennium 
Challenge Corporation grants, those funding levels should increase 
substantially.
  Mr. President, each of these commitments that I have referred to are 
set out in a letter that Ambassador Portman has provided to me.
  I ask unanimous consent that that letter be printed in the Record 
following my comments.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1)
  Mr. BINGAMAN. Mr. President, with these additional commitments, I 
have

[[Page 15062]]

concluded that I can support the implementation of this trade 
agreement. I will do so when the roll is called later today.
  I yield the floor.

                               Exhibit 1

         Executive Office of the President, the United States 
           Trade Representative,
                                    Washington, DC, June 28, 2005.
     Hon. Jeff Bingaman,
     U.S. Senate,
     Washington, DC.
       Dear Jeff: As the Congress considers the Central America-
     Dominican Republic Free Trade Agreement (CAFTA-DR), you have 
     raised concerns about ongoing efforts to improve enforcement 
     of labor laws and to monitor progress in this regard in the 
     CAFTA-DR signatory countries. As you know, Congress 
     appropriated $20 million in FY05 specifically for projects to 
     improve labor and environmental law enforcement in these 
     countries.
       The recent House Appropriations Committee mark-up of the 
     FY06 Foreign Operations appropriations bill increases this 
     commitment for the next fiscal year, with $40 million 
     earmarked for labor and environmental enforcement capacity-
     building in the CAFTA-DR signatory countries. The 
     Administration is willing to support this level of funding in 
     the FY06 Senate appropriations bill.
       Furthermore, because we are willing to make a longer-term 
     commitment to improve labor and environmental law enforcement 
     in the CAFTA-DR countries, the Administration is willing to 
     propose and support this same level of labor/environment 
     capacity-building assistance for the next three fiscal years, 
     FY07 through FY09.
       More specifically, you have suggested the assistance of the 
     International Labor Organization (ILO) in monitoring and 
     verifying progress in the Central American and Dominican 
     governments' efforts to improve labor law enforcement and 
     working conditions.
       We are willing to implement your idea. Your proposal, as I 
     understand it, is that the ILO would make a transparent 
     public report of its findings every six months. The 
     Administration has now consulted with the ILO and determined 
     that this function would require additional funding to the 
     ILO of approximately $3 million annually. The Administration 
     is willing to devote approximately $3 million of the $20 
     million in FY05 labor enforcement assistance monies to 
     support and fund this ILO monitoring initiative. To ensure 
     that this monitoring continues, the Administration is willing 
     to continue a funding commitment to ILO monitoring for the 
     next three fiscal years, FY07 through FY09.
       The Administration also shares your goal of ensuring that 
     we pair expanded trade opportunities with economic 
     development assistance designed to ease the transition to 
     free trade, especially for rural farmers in our CAFTA-DR 
     partners. On June 13, 2005, the U.S. Millennium Challenge 
     Corporation (MCC) signed a $215 million compact with Honduras 
     targeted specifically at rural development and 
     infrastructure, and on the same day the MCC announced a $175 
     million compact with Nicaragua that will be signed shortly.
       As Secretary Rice and I have already communicated to you, 
     we are willing to give high priority to negotiating compacts 
     with El Salvador, Guatemala, and the Dominican Republic when 
     those countries become eligible for MCC assistance under 
     higher per capita income caps next year. I anticipate that 
     such compacts would provide substantial U.S. economic 
     assistance for rural development in these countries.
       In addition, the Administration has worked with the Inter-
     American Development Bank (IDB) to provide new assistance, 
     including $10 million in new grants announced by the IDB 
     earlier this month for rural development and institution 
     building. I hope you will join me and officials from the IDB, 
     World Bank, and other institutions next month for an 
     international donors conference to discuss other ways we can 
     direct development assistance toward meeting the needs of 
     rural populations.
       To address your specific concern about the period before 
     MCC compacts might be negotiated with El Salvador, Guatemala, 
     and the Dominican Republic, the Administration is willing to 
     support additional spending for rural development assistance 
     of $10 million per year for each of those countries starting 
     in FY07 for a total of five years, or until the signing of an 
     MCC compact with such country, whichever comes first. This 
     amounts to a $150 million commitment in transitional rural 
     assistance for these countries over five years.
       These monies will provide transition assistance to rural 
     farmers in these three countries for a defined period, while 
     preserving a very strong incentive for candidate countries to 
     meet the statutory criteria to receive what would likely be 
     much higher levels of economic assistance under an MCC 
     compact. Since the implementation of CAFTA-DR requires steps 
     which reinforce the statutory criteria for funding under the 
     MCC law, I believe that implementation of the agreement will 
     assist these three countries to move quickly toward 
     qualifying for a successful MCC compact with the United 
     States.
       Furthermore, because many of the agreement's requirements 
     for agriculture liberalization in the CAFTA-DR countries for 
     sensitive commodities--such as dairy, poultry, and rice--will 
     not fully occur until ten, fifteen, or even twenty years 
     after CAFTA's implementation date, I am confident that this 
     transitional mechanism provides ample time for adjustment in 
     the rural economies of these nations.
           Sincerely,
                                                      Rob Portman.

  The PRESIDING OFFICER. The Senator from Illinois is recognized.
  Mr. OBAMA. Mr. President, I ask for approximately 10 minutes.
  Mr. BINGAMAN. Mr. President, may I ask my colleague to yield for a 
unanimous consent request?
  Mr. OBAMA. I yield for that purpose.
  Mr. BINGAMAN. Mr. President, I ask unanimous consent that the order 
of speakers be as follows: Senator Obama, 15 minutes from the time of 
Senator Dorgan; Senator Brownback, 15 minutes from Senator Grassley's 
time; Senator Coleman, 15 minutes from Senator Grassley's time; Senator 
Corzine, 10 minutes from Senator Dorgan's time; and Senator Burr, for 
10 minutes from Senator Grassley's time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Illinois.
  Mr. OBAMA. Mr. President, as the previous speaker, I rise to speak on 
the Central American Free Trade Agreement.
  I have thought long and hard about this agreement, and I come to the 
floor predisposed to support free trade. In the end, I believe that 
expanding trade and breaking down barriers between countries is good 
for our economy and for our security, for American consumers and 
American workers.
  On the margins, I recognize that CAFTA, although a relatively modest 
trade agreement by the standards of the U.S. economy, would benefit 
farmers in Illinois as well as agricultural and manufacturing interests 
across the country. The language in the agreement is also optimal with 
respect to intellectual property and telecommunications, issues that 
are of particular interest when it comes to trade with other countries, 
such as China. Unfortunately, CAFTA falls short, as a matter of process 
and substance, in protecting workers' rights and interests. My 
colleague, Senator Bingaman, mentioned some of those concerns.
  I recognize that we should not kid ourselves into believing that 
voting against free-trade agreements will stop globalization, 
especially agreements like CAFTA, where the countries involved have 
combined economies one-sixth the size of the State of Illinois.
  Globalization is not someone's political agenda. It is a 
technological revolution that is fundamentally changing the world's 
economy, producing winners and losers along the way. The question is 
not whether we can stop it, but how we respond to it. It is not whether 
we should protect our workers from competition, but what can we do to 
fully enable them to compete against workers all over the world.
  That brings me to the problem. So far, America has not effectively 
answered these questions, and American workers are suffering as a 
result. I meet these workers all across Illinois--workers whose jobs 
moved to Mexico or China and are now competing with their own children 
for jobs that pay $7 an hour and offer no health or pension benefits. 
In town meetings and union halls, I have tried to tell these workers 
the truth--that the jobs they have lost are not coming back; that 
globalization is here to stay; and that they are going to have to train 
more and learn more to get the new jobs of the future.
  I don't mind delivering that message. But when these same workers ask 
me exactly how are they going to get their training and their 
education, and when they ask what will they do to pay for their health 
care bills in the interim, and how will they deal with lower wages and 
the general sense of financial insecurity that seems to be growing 
every single day, I cannot look them in the eye and tell them honestly 
that their Government is doing a single thing about these problems.
  Since I have arrived in the Senate, I haven't seen us debate--much 
less

[[Page 15063]]

pass--legislation that would address these issues. That is the reason I 
will be voting against CAFTA when it comes up later today.
  There are real problems in the agreement itself. It fails to uphold 
the principles set out in previous trade agreements that say we must 
give equal protection to the rights of workers and the rights of 
commercial interests. But CAFTA, while encouraging the protection of 
commercial rights, does less to protect labor rights than some of the 
agreements that we have already passed. So there is a sense that we may 
be going backward instead of forward. Nor does CAFTA do much in the way 
of enforcing environmental standards in these countries.
  I recognize that no piece of legislation is perfect, and if it were 
just these provisions, perhaps I could do what my colleague from New 
Mexico has done and obtain a letter of agreement from the White House, 
indicating they will try to address some of these problems.
  But the real problem is more than CAFTA. It goes beyond the four 
corners of this piece of legislation. The real problem is what is 
missing, generally, from our prevailing policy on trade and 
globalization: meaningful assistance for those who are not reaping the 
benefits of trade, and a plan to equip American workers with the skills 
and support they need to succeed in the 21st century.
  So far, almost all of our energy and almost all of these trade 
agreements are about making life easier for the winners of 
globalization, while we do nothing for those who find their lives 
getting harder as a consequence of trade liberalization. In 2004, 
nearly 150,000 workers were certified as having lost their jobs due to 
trade and were thus eligible for trade adjustment assistance--and that 
number doesn't count the janitors and cafeteria workers who may have 
lost their jobs.
  Senator Wyden and others have tried to encourage the Administration 
to modernize this assistance and expand it to displaced service 
workers, but the Administration refuses to help on this issue.
  But even beyond displaced workers, our failure to respond to 
globalization is causing a race to the bottom that means lower wages 
and stingier health and retiree benefits for all Americans. It is 
causing a squeeze on middle-class families who are working harder but 
making even less and struggling to stay afloat in this new economy.
  I recognize the soundness of the economic argument that free trade 
reduces overall prices in this country. But as one downstate worker 
told me during a recent visit back in Illinois: ``It doesn't do me much 
good if I am paying a dollar less on a t-shirt, but I don't have a 
job.''
  So now we have to choose. It is a choice that is bigger than CAFTA 
and bigger than our trade agreements. It is one that America has faced 
time and time again in our history, and we have responded. To ease our 
transition from an agricultural to an industrial economy, we set up the 
public school system, busted up monopolies, and allowed workers to 
organize. To help us emerge from the Great Depression, we regulated the 
market, created unemployment insurance, and provided all workers access 
to a secure retirement. At the end of World War II, we grew the largest 
middle class in history by providing our returning heroes with a chance 
to go to college and own their own homes.
  Now we face the same choice. We are at the same juncture today. We 
have to decide whether we are going to sit idly by and do nothing while 
American workers continue to lose out in this new world, or if we will 
act to build a community where--at the very least--everybody has a 
chance to work hard, get ahead, and reach their dreams.
  If we are to promote free and fair trade--and we should--then we have 
to make a national commitment to prepare every child in America with 
the education they need to compete; to make sure college is affordable 
for everybody who wants to go; to provide meaningful retraining and 
wage insurance so that even if you lose your job, you can train for 
another; to make sure worker retraining helps people without getting 
them caught up in a bureaucracy; that such training helps service 
workers as well as manufacturing workers; and that it encourages people 
to reenter the workforce as soon as possible.
  We also have to figure out a way to tell workers that no matter where 
you work or how many times you switch jobs, you can take your health 
care and your pension with you always, so you have the flexibility to 
move to a better job or start a new business.
  All of this is possible. It is not going to be easy, and it is not 
going to be quick. I don't expect the Administration to try to shoehorn 
all the solutions to the displacements caused by globalization into a 
single trade agreement. But what I do expect--and I said this directly 
to the President when I met with him in the White House on this 
matter--is that we at least have, on a parallel track, an effort to 
deal with the losers in globalization, our displaced communities and 
displaced workers. We must not only look after profits and 
shareholders, but also those folks who are adversely affected by trade. 
Lower prices are good and important, but we also have to make sure that 
jobs exist that provide people the opportunity to raise a family.
  Mr. President, in order to compete, every single one of us is going 
to have to work more, think more, train more. I am not afraid of global 
competition, and I don't think a single American worker is afraid of 
it. We cannot insulate ourselves from all of the dislocations brought 
about by free trade, and most of the workers don't expect Washington to 
do so. On my side of the aisle, we cannot resort to protectionist 
language over the long term if we are, in fact, going to be looking 
toward the future of America. We have the talent and the brain power to 
continue to lead the world in this challenging new century, but now we 
need the political will. Now we need a national commitment. And that, 
so far, is what appears to be lacking on Capitol Hill.
  In America, we have always furthered the idea that everybody has a 
stake in this country, that we are all in it together, and that 
everybody deserves a shot at opportunity. The imbalance in this 
Administration's policies, as reflected in the CAFTA debate, fails to 
provide American workers with their shot at opportunity. It is time we 
gave them that shot.
  I yield back my time.
  (Applause in the Gallery.)
  The PRESIDING OFFICER. Expressions of approval or nonapproval are not 
permitted in the Senate Chamber.
  Who yields time. The Senator from North Dakota is recognized.
  Mr. DORGAN. Mr. President, how much time remains?
  The PRESIDING OFFICER. The Senator from North Dakota has 1 hour 32 
minutes remaining.
  Mr. DORGAN. How much time remains for the Senator from Montana and 
also on the majority side?
  The PRESIDING OFFICER. There remains 1 hour 11 minutes for the 
Senator from Montana, 5 hours 20 minutes for the Senator from Iowa.
  Mr. DORGAN. Mr. President, it would seem to me the Senator from Iowa 
would want to use some time at this point. I suggest the absence of a 
quorum and ask that the time run against the Senator from Iowa.
  The PRESIDING OFFICER (Mr. Cornyn). The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BROWNBACK. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BROWNBACK. Mr. President, on this beautiful day in Washington, 
DC, we are about to create some great opportunities for Kansas farmers, 
Kansas manufacturers, and opportunities of hope for people in Central 
America. That is to me what this CAFTA bill represents. I do not want 
to oversell it. I do not think it should be oversold. I do not think it 
is a panacea for democracy building or opportunity in Central America. 
I do not think it is a panacea for all my farmers and manufacturers in 
the State of Kansas. But I do think it is a little more good in the 
world, a little more good for opportunities for

[[Page 15064]]

people in the United States, lowering tariffs and trade barriers in our 
neighborhood, in this region of the world, a little more good and 
opportunity for economic chances and opportunities in Central America 
and the Dominican Republic, chances that do not exist today, chances 
that are not doing well today in Central America, chances that are 
hurting the spread of democracy, free societies, even in our own 
hemisphere.
  I was troubled recently when I read a poll published by one of the 
major newspapers in this country. The poll was asking people in Central 
and South America would they give up their democracy if their economy 
would grow. In other words, if a dictator comes in and can produce 
economic reform and opportunity where you would have a growing economy 
instead of the stagnant situation you are in today, would you give up 
democracy?
  A surprisingly large number of people said yes. I suppose in their 
hierarchy of needs, what they were looking at is: Look, democracy is 
great, but what I need right now is a job, what I need right now is 
income for my family, what I need right now is to be able to pay my 
bills and send my kids to school. If I have to give up this other right 
to do that, I am willing to look at it.
  I was very troubled by that poll. I have relatives traveling to 
Central America talking with me in return about the troubling aspects 
of what they are seeing in the willingness to give up democracy and the 
fragility of democracy in our own hemisphere because of a lack of 
economic opportunity.
  I think as well a lot of this is because of the juggernaut China is 
today, more than we solve by CAFTA. CAFTA is a little more good. CAFTA 
is a positive step in the right direction for those democracies to 
build economies and for opportunities for us in this country. It is not 
opportunities for everybody. There will be winners and some losers, as 
there are in trade agreements, because on the basis of a trade 
agreement, each country does what they do best and then you trade goods 
back and forth. Overall, the economy is lifted. There are people who 
are dislocated and harmed in these processes.
  Overall, there is a betterment of societies, cultures, and 
opportunities. That is what I think overall will take place with CAFTA.
  I do believe we have an extra issue that is at risk and is rewarded 
by CAFTA, and that is democracy building in our hemisphere. I do not 
think it can be put forward too lightly.
  While I do not think people in Central America will say, OK, I am 
going to rejoice with the passing of CAFTA, that this is going to solve 
all my problems, I do think it will remove a great deal of hope if this 
does not pass. It will certainly have a negative impact in Central 
America if it does not pass, and I think we have to look at that as 
well.
  Everybody has heard the numbers until I am sure they are blue in the 
face. The U.S. tariff regime is one of the lowest in the world, 3 
percent. For a State such as mine, Kansas, having open markets is vital 
for the exportation of agricultural commodities. The aircraft industry 
is also dependent upon an export market. So additional liberalization 
should benefit our producers.
  About one-third, or $3 billion in farm cash receipts out of a total 
of $9 billion of gross farm income in Kansas comes from exports. Kansas 
ranks sixth in the Nation for States with the greatest share of 
agricultural exports. Movement toward freer economies is helpful in 
doing that.
  I want to focus briefly in the time I have on a couple of specific 
products that will benefit my State. As I mentioned, we have a heavy 
agricultural export industry. Agricultural exports support some 47,000 
jobs in Kansas. I think, in this particular case, we have a decent 
chance of expanding more agricultural exports.
  Beef is our largest section of the agricultural economy of my State. 
We are the second largest beef exporter in the country. As I mentioned, 
it provides the single largest source of cash receipts in agriculture 
in my State at over $5.6 billion. We believe CAFTA will help the cattle 
industry.
  Pork producers, who add about $252 million to Kansas annually, will 
also benefit from the trade agreement.
  Current import tariffs on U.S. beef exports is as high as 30 percent 
in some of these countries. Duties on the products most important to 
the U.S. beef industry--prime and choice cuts--would be eliminated 
immediately in these Central American countries.
  I don't want to paint that again as a panacea because I don't think 
there is going to be a large initial export. There is not a large 
market of that cut initially, although there is market opportunity.
  The American Farm Bureau Federation economic analysis of CAFTA 
estimates that Kansas will increase meat exports to the six countries 
by $130 million per year on the full implementation. That full 
implementation has a very long window to it, 2024. This is some period 
to come.
  These are economic analyses which are useful to use to generally show 
trend lines. I have learned enough over the years to not rely upon 
these as money in the bank because factors come in to play--sanitary 
issues enter the picture, and we have recently been wrestling with BSE. 
Those all are major factors. Still, it points to a positive trend line.
  As the Nation's top wheat exporter and with State farm cash receipts 
of $1.3 billion, Kansas wheat producers will benefit from CAFTA. Grain 
suppliers will benefit from zero tariffs immediately on wheat in all 
six countries, as well as some processed grain products.
  Again, the American Farm Bureau economic analysis of CAFTA estimates 
that Kansas will increase wheat exports to the six countries by $8 
million per year. Again, this is after full implementation of CAFTA. 
That is some time in the future. Its economic analysis could well be 
off, but it shows a generally positive trend line--small but positive. 
That is why I say a little more good in the world for my producers.
  I conclude by saying, as we continue to fight this global war on 
terrorism, we must continue to spread democracy and hope throughout the 
world. Engaging in free trade practices and policies helps improve 
relationships with other countries and improves the standard of living 
in these developing countries. Helping to improve other countries' 
standard of living will result in a more hopeful society and a more 
peaceful world.
  Certainly we have learned over the years that democracies are far 
easier and better for us to deal with. If we can help strengthen 
democracy, particularly in our hemisphere, by this passage, minor as it 
might be as a positive point, that is a good and hopeful sign and 
something we should do.
  I support CAFTA, and I urge my colleagues to vote in favor of passage 
of the CAFTA trade agreement.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. COLEMAN. Mr. President, I rise in support of CAFTA. There are a 
lot of reasons to support this trade agreement. I came to this 
decision, by the way, in the last couple of days.
  As chairman of the Subcommittee on Western Hemisphere, Peace Corps, 
and Narcotics Affairs of the Foreign Relations Committee, I understand 
how pivotal CAFTA is on U.S. foreign policy goals, not just in Central 
America but Latin America and the Caribbean. There are folks in Latin 
America looking at this agreement and what we do with it. I think they 
are going to judge us as to whether we are committed to strengthening 
this hemisphere, committed to strengthening the democracies that are 
now in Central America. There have been decades of civil war. We have 
democracies flourishing in Central America. Every President in those 
countries was democratically elected. These leaders have come to us and 
said: We want to reform, we want to grow our economies and strengthen 
democracy.
  CAFTA is important. Democracy in Central America is still fragile. 
Poverty is endemic. There is weakening enthusiasm for democracy. 
Pressures

[[Page 15065]]

are already present in Nicaragua. That is what we have.
  We have to be realistic about CAFTA. It alone is not going to ensure 
democracy or prosperity in Central America, but it will put in place 
building blocks for economic growth in the future. It will help these 
nations compete with the face of a rising China and, perhaps most of 
all, CAFTA is a political message that the United States recognizes how 
far these nations have come and stands shoulder to shoulder with our 
democratic hemispheric neighbors. That is important.
  I try to guide myself at times by the physicians' adage, which is, 
``Do no harm.'' Up until 2 days ago as I looked at CAFTA, it did harm. 
It did harm to an industry that is very important to me in Minnesota. I 
represent probably the largest production of sugar beets in the 
country. People say: You are protectionist of an industry. It is not 
about an industry, it is a matter of 40,000 moms and dads whose 
economic livelihood is dependent on what happens with sugar. There is 
$2 billion a year injected into that economy in that region, and that 
is important.
  As my colleagues know, yesterday the Agriculture Committee chairman, 
Saxby Chambliss from Georgia, and I secured a commitment from the White 
House to address the serious concerns we had regarding CAFTA and sugar. 
Chairman Chambliss--I don't think they grow a lot of sugar beets in 
Georgia. In fact, I was expecting by the end of that negotiation that 
there would be a peach-to-ethanol program coming out of that 
arrangement, but that did not happen.
  Chairman Chambliss made it very clear that he is going to protect the 
farm bill, see the continuation of the farm bill which is set to expire 
in 2007.
  As we looked at CAFTA as we negotiated, it would have violated the 
farm bill in that it had the prospect of having sugar from CAFTA 
countries entering this country, if it reaches a certain level and goes 
over that--I will not get into the technicalities of the sugar 
program--one sees the collapse of the sugar program. One sees sugar 
forfeited to the Government, prices falling, economic disaster for 
those involved in the sugar industry.
  So Chairman Chambliss showed great leadership and great courage in 
saying he was not going to support CAFTA because it had this hole in 
the agreement that would in the end perhaps amount to a violation of 
provisions of the farm bill. He stood firm. Together, then, with a 
number of our other colleagues, both in the House and the Senate, he 
had a series of discussions with the administration, with the sugar 
industry, and got a commitment. Again, I want to thank Chairman 
Chambliss, who stood with those of us who represent sugar, though that 
was not a personal thing. It was simply the right thing to do. That is 
the way he operates, with good Georgia common sense and that incredible 
Georgia strength.
  The commitment we have from the administration pledges to ensure that 
the maximum sugar import cap established under the 2002 farm bill will 
never be violated through the life of this farm bill. So that magic 
level of 1.532 million tons that we call short tons is not going to be 
violated. This commitment was made in the context of CAFTA, but the 
commitment is not limited to CAFTA and that is important. During the 
course of our discussions, we became aware that other things were going 
on regarding sugar, that under NAFTA we were facing a situation in 
which resolving a high fructose corn syrup issue that involves the 
ability for us to bring more of that into Mexico, the result would have 
been more Mexican sugar coming into the United States and, again, then 
going over this level and triggering the collapse of the program.
  In the end, as I stood there working for my sugar growers and those 
whose livelihoods depend on sugar, I wanted to make sure our folks were 
held harmless by CAFTA. We got that commitment from the administration. 
We wanted to make sure they were held harmless by the impact of what is 
happening with NAFTA. We got a commitment to hold them harmless during 
the course of this farm bill.
  Then we were concerned about other trade agreements that are being 
negotiated at this time. There are discussions with Panama, discussions 
with Thailand, all of which could have had the same effect of reaching 
that maximum sugar import cap and violating and causing a collapse of 
the program. We wanted to be held harmless for that, our sugar growers 
did, and we got them that commitment.
  Under this agreement any sugar imports above the current cap 
established by the farm bill, whether under CAFTA, NAFTA, or any other 
trade agreement, would be denied entry into the United States 
altogether unless an equivalent amount of U.S. sugar is converted into 
ethanol or other nonfood uses with at least 109,000 tons--and that is 
what we would have gotten from NAFTA--being converted to ethanol under 
a pilot program run by the USDA.
  In addition, we received a commitment to begin a study on the long-
term promise of the sugar-to-ethanol program. That promise is real. I 
was in Brazil not too long ago. Fifty percent of all the new cars in 
Brazil run on ethanol. Those cars are manufactured--the largest 
manufacturer is General Motors, an American manufacturer, and all the 
ethanol in Brazil is done by sugar. So we know the rest of the world 
does it. We can do it here.
  The commitment has been made. The commitment stands. It is through 
the length of the farm bill. The farm bill goes for another 3 years, 
but if it should be extended--and I think it should be--the White House 
commitment is also extended.
  The bottom line is this: Not only do we prevent CAFTA from breaking 
the farm bill limit on sugar imports, but we prevent NAFTA and all 
future trade agreements from breaking the farm bill cap as well.
  In addition, what we do--and I think this is so critically 
important--is lay the ground for the long-term future of the U.S. sugar 
industry which lies not just in production in the United States--
because we do not export sugar to other countries; it is for domestic 
consumption--but production to fuel our country through renewable fuels 
right alongside corn and soybeans. That is the future.
  This country is beginning to understand that we simply cannot deal 
with the continuing increase in imports of foreign crude. A barrel of 
oil is $60. A price of a gallon of gas is $2.30, $2.40, $2.50, $2.70. 
We have our own oilfields, and there are cornfields, soybean fields, 
and sugar fields, beet and cane. They are providing an opportunity--we 
have sugar now on the path.
  I know many of my sugar farmers and cooperatives do not agree with me 
on this commitment, do not agree with me on this solution. I respect 
that. What we have is a concern that they would much rather see a 
permanent solution. We have permanent solutions now with corn into 
ethanol and soybeans into ethanol. These are dedicated folks. They sat 
at the table the whole time.
  One of the critics of this proposal or commitment that I have, and I 
take it seriously, said, this is a Band-Aid on a gaping wound. I would 
say to my friends at American Crystal, at Minn-Dak, at Southern 
Minnesota, and other cooperatives and other places throughout the 
country that, in fact, there is a gaping wound; that the sugar industry 
is one that is right now in a fragile place. I would argue that rather 
than a Band-Aid, this is a tourniquet; that for 3 years we stop the 
bleeding; for 3 years we then will be able to begin to develop a 
nascent sugar-to-ethanol industry; that we then get ourselves to focus 
on the next farm bill and try to make sure we have a program that has 
greater permanence, that has greater long-term security so the kids in 
Fisher and Hallock and throughout, certainly. Western Minnesota can go 
to school with moms and dads not worrying about their jobs. I am 
talking not just farmers but truckers and factory workers and seed 
dealers and implement dealers. The list goes on and on. Up and down 
Main Street, sugar makes a positive mark on communities throughout my 
State. So, for me, this is worth fighting for. It is worth defending. 
That is what I believe we have done with this commitment.

[[Page 15066]]

  Without it, the Red River Valley has zero protection from NAFTA, zero 
protection, obviously, from CAFTA which we are talking about today, 
zero protection from future trade agreements. Again, under NAFTA alone 
there is some discussion of perhaps 900,000 tons of Mexican sugar 
pouring in over the border the next couple of years. Without this 
protection, without this commitment, prices would tank and the U.S. 
sugar policy would be placed in serious jeopardy. That keeps me up at 
night. That worries me.
  I am going to sleep a little easier knowing that my farmers are 
protected with this commitment. That is what we have then, this 3-year 
window to turn all the attention and energy we had to focus on the past 
on putting our fires toward creating a positive solution and a future 
for this industry. That is my choice. That is the future that I choose.
  That said, let me be very clear about something, and I want to lay 
this on the line, kind of talk as we look to the future. Two years ago, 
I said sugar should not be included in these bilateral regional 
agreements. We would not have these discussions, if that was the case. 
Just as domestic support for every other American farmer is not 
included in these kinds of agreements, sugar was not asking for 
anything special. The fact is, sugar should not be included in these 
agreements because the distortions in a global sugar market cannot be 
addressed fairly in any other setting other than WTO. This has to be 
addressed on a global perspective; otherwise, what we have is little 
bits and pieces come in. Ultimately, we flood this country without 
dealing with what is happening in this global environment.
  Europeans have a lot more protective interests and support they 
provide for their sugar growers than what we face right here. So every 
sugar-producing country in the world subsidizes and supports this 
industry, which is why American sugar farmers, who are among the top 
third in efficiency, need a strong U.S. sugar policy to stand with 
them.
  We did what is right in the Australian agreement, which is why it 
passed so quickly. For some reason, this common sense did not show 
through when CAFTA was negotiated. Again, the good news is in the near 
term we have a commitment from this White House to hold the U.S. sugar 
program harmless not only under CAFTA but under NAFTA and any future 
trade agreements.
  At the end of the day, let me say that I share the disappointment of 
those in the sugar industry who want something more permanent, but I do 
feel I have to grab hold of the possible when the optimal seems to be 
out of reach. I think politically it would be easy for me to just cast 
a ``no'' vote, just say to my producers the industry does not like this 
and kick the can down the road. Then, if 900,000 tons of NAFTA sugar 
gets dumped in, I can maybe pretend that it is just enough to be angry, 
just enough to say why did we not do something.
  The easy thing is not always the right thing to do. Sometimes when 
one is dealing with friends, they have to be told they are wrong. 
Sometimes leadership is letting people know that we have to go to a 
certain place even if they do not yet see the righteousness of going 
there.
  The right place to be is to have this insurance policy, to have 
protection from CAFTA, from NAFTA, from future trade agreements, and 
really important, get us involved in the sugar-to-ethanol industry.
  Last comment: I listened as I sat in the Presiding Officer's chair to 
a lot of debate. I heard so many of my colleagues today saying we have 
to be doing more for Central America, except the one thing Central 
Americans say they want and need most. It reminds me of a joke we have 
in Minnesota about the Scandinavian guy who loved his wife so much he 
almost told her.
  I listened to my friends across the aisle and they tell me they care 
so much, and we have to be doing more, but they do not want to do 
anything. They want to protect the workers, those in Central America, 
give them economic opportunity. Listen to their elected leaders who say 
this is important rather than lamenting what we should have done or 
could have done but did not do.
  We have an opportunity to do something, and that is what we are 
doing. In the end, my decision was only made in the last couple of days 
because the concern about sugar has been so great. Maybe it is the dad 
on me who focuses not so much on the ones who are doing well but the 
ones who need a little help. Our friends in sugar needed a little help 
after this agreement was negotiated. We provided that help.
  Doing that, I can then stand with all the other producers in my 
State: the commodity groups, the cattlemen, the corn growers, the 
soybean growers, the pork producers, the businesses, the chambers of 
commerce, the high-tech folks, the 3Ms--all who say this is a good 
thing for jobs in Minnesota, this is a good thing for the economic 
future, and as a result I will cast my vote for CAFTA.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time?
  Mr. CHAMBLISS. Mr. President, I ask unanimous consent that my time be 
charged against that of Senator Grassley, please.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CHAMBLISS. Mr. President, I first want to say thanks to my good 
friend from Minnesota for his kind comments. I am going to have more to 
say about him in a few minutes. The one thing we all find out in this 
great institution that we have the privilege of serving in is that 
everybody in their own way represents, in a very strong manner, the 
constituents who sent them here. Nobody has represented their 
constituents better over the last several weeks relative to this issue 
of CAFTA, and particularly the sugar issue, like Norm Coleman has.
  Senator Coleman has been a true advocate for the interests of his 
State. They need to erect a big sugar beet for him and call it the 
Senator Coleman Memorial back in Minnesota.
  I rise today to support the Dominican Republic-Central America Free 
Trade Agreement or DR-CAFTA. Earlier this year, I expressed opposition 
to DR-CAFTA since a provision in the agreement violates a part of the 
2002 farm bill.
  As chairman of the Senate Agriculture Committee, I have a 
responsibility to the agricultural community to ensure Congress 
fulfills the commitments that we made to farmers and ranchers back in 
2002 when we negotiated the farm bill and when it was passed by the 
House, by the Senate, and signed into law by the President.
  My specific concern centered on a provision that severely impacts the 
implementation of the farm bill by increasing sugar imports into the 
United States.
  We grow very little sugar in my State. This is not a parochial 
interest to me. Senator Coleman is right, perhaps I should have 
negotiated a peach, tobacco, or cotton ethanol provision in here. My 
whole point in this matter is that we have to maintain the integrity of 
the farm bill. It could just as easily have been a corn issue, wheat 
issue, or a peanut issue, but it just happened to be sugar. This could 
potentially result in exceeding the import trigger provided for in the 
farm bill.
  Exceeding the import trigger is of utmost concern because it is 
designed to manage domestic supplies and ensure the program operates at 
a no net cost to the U.S. taxpayer. The DR-CAFTA could compromise that 
trigger when combined with existing commitments to Mexico under the 
North American Free Trade Agreement, or NAFTA.
  In addition, the so-called compensation mechanism in the DR-CAFTA 
does not provide any additional comfort. I do not think it is a good 
idea to pay other countries not to import sugar into the United States 
when we can use those resources to promote fuel security here at home. 
I believe we all should be chastised back home if we let that happen.
  There have been several long weeks of discussions between the 
administration, which included the White House, USDA and USTR 
officials, Senators

[[Page 15067]]

and House Members, and industry representatives. After much hard work, 
the administration has agreed to a proposal that addresses my concerns 
relative to this trade agreement.
  Secretary Johanns has sent me a letter that provides assurances that 
the sugar program will operate as we originally intended through the 
2007 crop year. Furthermore, the Secretary committed to holding the 
sugar program harmless for the next 2\1/2\ years, to the completion of 
this farm bill, from any harmful effects of CAFTA, of NAFTA, and of any 
other trade agreement that may be negotiated during the interim period.
  Mr. President, I ask unanimous consent the Secretary's letter be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 The Secretary of Agriculture,

                                    Washington, DC, June 29, 2005.
     Hon. Saxby Chambliss,
     Chairman, Committee on Agriculture, Nutrition and Forestry, 
         Russell Building, Washington, DC.
     Hon. Bob Goodlatte,
     Chairman, House Agriculture Committee, Longworth Building, 
         Washington, DC.
       Dear Chairman Chambliss and Chairman Goodlatte: The purpose 
     of this letter is to provide assurance that the Dominican 
     Republic-Central America-United States (CAFTA-DR) Free Trade 
     Agreement will not interfere with our ability to operate the 
     sugar program in a way that provides the full benefit to 
     domestic growers through the remainder of the Farm Security 
     and Rural Investment Act of 2002.
       The Farm Bill contains a sugar ``import trigger'' of 1,532 
     million short tons which if exceeded precludes the use of 
     domestic marketing quotas and thus could prevent the program 
     from being operated on a ``no net cost'' basis as required by 
     the law.
       Since the U.S. Government already is obligated under 
     international agreements to import annually 1.256 million 
     short tons, there is some concern that annual imports from 
     NAFTA, CAFTA, and other trade agreements in addition to this 
     amount could exceed the Farm Bill trigger and thus jeopardize 
     operation of the program. However, the Charter Act of the 
     Commodity Credit Corporation (CCC) provides additional tools 
     required to preclude that eventuality.
       In the event I determine that sugar imports will exceed the 
     current Farm Bill trigger, appropriate steps will be taken to 
     ensure the program is not put at risk. As Secretary of 
     Agriculture, I have the authority to preclude the actual 
     entry of imported sugar into the domestic sweetener market by 
     making payments to exporters and direct purchase of the sugar 
     for restricted (nonfood) use, including ethanol. It would be 
     my intention to use agricultural commodities in payments or 
     to make direct purchases.
       Two possible situations could obtain:
       If I determine that the Farm Bill import trigger will be 
     exceeded and that the domestic market is adequately supplied 
     with sugar (i.e., that the imported quantities above the 
     trigger will jeopardize sugar program operation), then I will 
     direct that excess imported sugar up to an amount equivalent 
     to the CAFTA-DR imports be purchased by CCC and be made 
     available for conversion into ethanol. Excess sugar above 
     that amount could either be precluded entry by payment to 
     exporters or made available for non-food use, as I deem 
     appropriate.
       If I determine that the amount of sugar that can be 
     provided by domestic growers plus the minimum import 
     requirement is insufficient to meet the domestic market's 
     needs and that imports sufficient to do so will exceed the 
     Farm Bill import trigger, then those imports will be allowed 
     and no sugar would be diverted for conversion to ethanol.
       In addition, USDA will undertake a study of the feasibility 
     of converting sugar into ethanol. Data obtained from any 
     conversion of sugar to ethanol, as noted above, will become a 
     part of the study analysis. This study will be completed and 
     submitted to the Congress not later than July 1, 2006.
       Such actions would ensure that the Farm Bill trigger is not 
     exceeded to the disadvantage of growers and that U.S. sugar 
     procedures will still have a share of the market no less than 
     the amount provided for by the Congress through the sugar 
     program.
       I will establish a special monitoring mechanism to review 
     all U.S. Customs, Bureau of the Census, and other import data 
     through the year. This mechanism will enable me to stay 
     apprised of the pace of imports and to use the Charter Act 
     authorization in a timely manner. Also, the Office of the 
     U.S. Trade Representative has analyzed this approach and 
     concluded that it is not inconsistent with our World Trade 
     Organization obligations.
           Sincerely,
                                                     Mike Johanns.

  Mr. CHAMBLISS. Specifically, if the farm bill import trigger is 
exceeded and the domestic market does not need additional quantities, 
then the excess imported sugar, up to an amount equivalent to the DR-
CAFTA imports, will be purchased by the Commodity Credit Corporation 
and made available for conversion into ethanol. Excess sugar above the 
trigger in the DR-CAFTA amount would be precluded entry by payment to 
exporters or preferably directed to other nonfood uses, such as 
additional ethanol production.
  I think this is a very important development, since it is the first 
time the Department is committing itself to a sucrose-to-ethanol 
program. The Department will also conduct a feasibility study examining 
the economics of sucrose-based ethanol. The study will be completed and 
submitted to the Congress not later than July 1, 2006. This should be 
enough time for us to use the information contained in the study to 
develop a long-term future program for the sugar industry in the next 
farm bill.
  On Tuesday of this week, we passed a very historic bill in this body. 
Our country has the greatest natural resources of any country in the 
world, but yet we have never established a long-term energy policy. For 
the first time in the history of the country we passed an Energy bill 
that will move us in the direction of becoming less dependent on 
foreign imports of oil for our petroleum and other fuel needs in this 
country. A major part of that Energy bill was a provision for 
alternative fuel resources like ethanol. In fact, there is a provision 
in there for the production of 8 billion gallons of ethanol per year in 
this country, which would be great if we could produce that amount and 
have it available all across America and not in the limited areas where 
it now is used.
  The reason it is in limited areas today is because we simply do not 
have the production of organic-based material to provide ethanol all 
across America. But with this provision that has been negotiated as a 
part of this agreement with the Secretary and USTR, we are going to 
take another crop, sugar, and we are going to convert sugar into 
ethanol in much the same way that we convert corn into ethanol, so we 
can have a greater supply of an alternative fuel, other than gasoline, 
for use by the American consumer.
  Under this agreement, the Secretary will have the ability to meet any 
changing domestic market conditions. If the amount of sugar provided by 
domestic growers, plus the minimum import requirement, is insufficient 
to meet the domestic market's needs and imports sufficient to do so 
will exceed the farm bill import trigger, then those imports will be 
allowed and no sugar would be diverted for conversion to ethanol.
  Another important aspect of this agreement will ensure that the USDA 
will review all U.S. Customs, Bureau of Census, and other import data 
to monitor imports throughout any given year. Many of us have heard 
criticism with regard to past trade agreements about lax enforcement 
and implementation of their provisions to the detriment of our 
producers. This will help address those concerns.
  In spite of the letter from Secretary Johanns and the assurances of 
the administration, the sugar industry opposes this agreement and will 
not support passage of this trade agreement. While I may disagree with 
their conclusions, that is their right. I want to say, at this time, 
that we have had a number of meetings between Members of the House, 
Members of the Senate, members of the industry--which have included 
USTR and other administration officials, including Secretary Johanns. 
We have had meetings with them and without them. At every single 
crossing, the sugar industry has negotiated in good faith and they have 
been very straightforward and above board with us. I commend those men.
  It is a great country that we live in that will allow us to dialog 
over an issue that is so important, as is this, to those farmers, to 
the Members of the House, and the Members of the Senate, as well as to 
others who have a significant interest in this, and to come out at the 
end of the day with an agreement with which some of us agree but with 
which others still have the opportunity to disagree.

[[Page 15068]]

  This agreement can be a real building block for sugar provisions in 
the next farm bill. Let me emphasize that my concerns have been fully 
satisfied, and I do plan to vote in favor of DR-CAFTA.
  This trade agreement is also important to many people in my home 
State of Georgia. I have heard from many workers who will reap the 
benefits of increased trade with Central America and the Dominican 
Republic. Reducing trade barriers will not only enhance American 
economic growth but will greatly benefit businesses in Georgia as well, 
by allowing more Georgia-made products to be sold into Central America.
  The DR-CAFTA region is an important trading partner with Georgia. 
Georgia's exports to the DR-CAFTA region increased $113 million from 
2000 to 2004, and collectively the countries of DR-CAFTA were Georgia's 
9th largest export destination.
  According to the Department of Commerce, the DR-CAFTA will help 
Georgia's textile manufacturers, chemical and paper manufacturers, as 
well as Georgia's farmers, because DR-CAFTA provides U.S. suppliers 
with access to these markets and levels the playing field with other 
competitors.
  Let me take a moment to praise the efforts of the Secretary Mike 
Johanns and U.S. Trade Representative Rob Portman for their hard work 
and their tireless efforts. These officials addressed each and every 
issue that we discussed. Without their good-faith efforts, this 
agreement simply would not have been possible.
  Special note should also go to my good friend, Senator Norm Coleman. 
His leadership and hard work in this effort has only increased my 
enormous respect for him. We have worked very closely over the past 
couple of weeks helping lay the foundation for a long-term and 
profitable future for the U.S. sugar industry. He is a workhorse, and I 
want him on my side every time.
  Let me conclude by saying I am very pleased with what we have 
crafted. This agreement will protect the sugar industry for the next 
2\1/2\ years, through the life of this current farm bill. It deserves 
the support of the Congress. I look forward to voting for DR-CAFTA.
  The PRESIDING OFFICER. The Senator from New Jersey is recognized for 
10 minutes.
  Mr. CORZINE. If the chair will be so kind to let me know when I have 
2 minutes left?
  The PRESIDING OFFICER. Certainly.
  Mr. CORZINE. Mr. President, let me say from the start, I have thought 
about this long and hard. I believe in the seriousness and the 
potential for free-trade agreements. But after looking at this 
particular one, and looking at it in the context of our overall 
macroeconomic policy, I am unfortunately going to have to vote against 
this proposed Dominican Republic-Central America-Free Trade Agreement.
  I have supported other agreements: Australia, Jordan, and Morocco. I 
believe in comparative advantage. There are lots of good reasons why 
free-trade agreements that are fair are ones we ought to promote. But 
they need to preserve and protect important labor, environmental, and 
security interests as well. I do not think this one does that. As a 
matter of fact, a trade agreement between the United States and Central 
America with the proper safeguards I think is a good thing. I just do 
not believe that we have embedded those in this particular agreement.
  American workers justifiably feel insecure in today's economy, 
particularly with the outsourcing or exporting of American jobs that 
comes from so much of our trade policy. People are concerned whether 
those American jobs are going to stay at home. The increasing trade 
deficit puts an exclamation point on ``there is something afoul'' with 
our trade policy.
  All I have to do is point to this chart. Since 1993, when we started 
with NAFTA to where we are today, we have seen nothing but red ink flow 
from the trade agreements and trade arrangements that we have. 
Something is not working.
  I would like to understand how this agreement is not just another 
piece, another one in a long line of bad trade agreements. Before we 
rush forward with this, I would like to understand what is happening 
that has brought about this kind of problem. We have a $617 billion 
trade deficit on an annualized basis this year. I believe we have a lot 
of evaluation that needs to be taken before we step forward on this. We 
are clearly on the wrong track, based on the policies that we have.
  On a parochial level, since NAFTA was implemented back in 1994, New 
Jersey has lost 130,000 manufacturing jobs. We used to have about 25 
percent of our workforce in the mid-1980s in the manufacturing 
industry. Today it is below 9 percent.
  We have seen the textile industry in New Jersey absolutely decimated. 
From the economic calculations that I have seen, 46,000 of those 
130,000 manufacturing jobs lost were due to NAFTA.
  We had great companies--Allied Signal, American Standard. All of 
Patterson's textile industry left our State. We have had enough of it. 
I think we need to understand what we are doing and what the 
implications are for working men and women of this country of another 
free-trade agreement.
  If you put this into a context that the gross metropolitan product of 
the city of Newark is $103 billion, and this is only $85 billion for 
all these countries--I don't understand why this is such a priority, 
particularly given all the other issues that we have in this country 
and particularly while we are thinking about it in the context of a 
$617 billion trade deficit.
  I don't think we have our priorities ordered right here. I 
particularly think we do not have them ordered right when you compare 
this issue with our trade deficit with China, which is $162 billion. 
This, I am told, is the No. 1 priority of the administration with 
regard to trade policy. Where does that come from, when we have all of 
these difficulties in our trade arrangements?
  China has had a fixed currency pegging versus the dollar since the 
late 1990s, not working to protect intellectual property rights between 
our two countries, and there are all kinds of enforcement issues with 
the WTO. I don't get it. Where are our priorities? We have a $617 
billion trade deficit. We are talking about something that will be a 
minuscule piece of that. And we are doing it with a blind eye to major 
problems in our trade policy.
  That is the major reason I am voting against it. There are a whole 
host of other issues that need to be considered. What happens to labor 
rights and what happens to environmental rights not only with regard to 
our workers but in those countries themselves? Where are we going to 
go, when we look at the lack of enforcement with regard to labor 
principles in those individual countries? The same thing goes for 
environmental issues. I don't understand why we are ceding the ground 
on these issues. Believe me, we have enforcement standards with regard 
to commercial rights and investment rights, but when it comes to 
working men and women, when it comes to our environmental protection--
which, by the way, is a global issue--we just say it is up to them with 
regard to their own standards.
  That is not the way to do business, in my view, and I think this is a 
failed piece of legislation. It is a step back from what we did with 
Morocco and Jordan and other trade agreements that had positive 
enforcement responsibilities with regard to labor and environmental 
rights. This harms workers in those countries, not only harming workers 
in the United States.
  There is a very clear example. I want to talk a little bit about it. 
NAFTA's liberalization, so-called, was supposed to promote job growth 
in Mexico. It lost 1.7 million rural farmers their access into the 
agricultural sector in Mexico, with the only increase, of about 800,000 
new jobs, in the industrial sector. Some of those are now leaving 
because they are losing out to other parts of the world that have even 
lower labor standards and environmental standards and lower costs of 
labor. There is something wrong with this vicious cycle of eroding jobs 
here at home, even in some of the places that we think we are promoting 
them,

[[Page 15069]]

through these free-trade agreements, and we have to get this settled 
out.
  I do not understand why we continue to stay on the same track--and I 
am an old, washed-up businessman. I believe in making sure the 
comparative advantage follows in the proper way. If it turns out you go 
from a balanced trade arrangement to a $617 billion trade imbalance in 
a given year, and you have seen almost nothing but a straight line fall 
off in our ability to export our goods on a relative basis to the rest 
of the world, we are making a big mistake, and we have a lot to 
reevaluate.
  It is time for a change with regard to our trade policies because 
they are not working economically and we are losing our ability to 
control our own destiny in our foreign reserves in other countries. It 
is not working because we are losing jobs at home and undermining 
working men and women's ability to have a high-quality standard of 
living, and we are not particularly helping others overseas. It is not 
a net boom for the countries we think we are trying to support.
  If we are not going to have strong labor, strong environmental 
rights, if we are not going to get some kind of benefit, a major 
macroeconomic benefit, I don't understand why we are approving all of 
these trade agreements. That is why I will be voting no on this CAFTA 
legislation before the Senate.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Ohio.
  Mr. DeWINE. Mr. President, I yield myself 10 minutes from the time of 
Senator Grassley.
  Mr. DORGAN. Mr. President, I shall not object, but I wonder if I 
might add to the unanimous consent request. Senator DeWine has asked 
for 10 minutes of Senator Grassley's time; we ask that Senator Byrd be 
recognized for 20 minutes from my time following the presentation by 
Senator DeWine; following that, Senator Burr be recognized for 10 
minutes from Senator Grassley's time; following that, Senator Reid will 
be recognized for 10 minutes from Senator Baucus's time. I ask that by 
unanimous consent.
  The PRESIDING OFFICER. Would the Senator specify which Senator Reid?
  Mr. DORGAN. Senator Reid from Nevada.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Thank you. I apologize for interrupting my colleague.
  The PRESIDING OFFICER. The Senator from Ohio is recognized for 10 
minutes.
  Mr. DeWINE. Mr. President, DR-CAFTA is good for my home State of 
Ohio, and it is good for our country.
  I was in the House of Representatives in the 1980s when significant 
strides were made toward democracy in Central America. We all remember 
that struggle. We all remember the resources that were put into Central 
America by the United States. It is time for us to refocus on Central 
America. If Central America is going to flourish, if democracy is going 
to continue in Central America and the economy is going to develop 
there, this is an essential component of that, an essential piece of 
that. While it is true that DR-CAFTA is only one piece of the puzzle, 
it is an important piece in determining the economic health of our 
neighbors to the south. Also, it is important to our own Nation as 
well.
  DR-CAFTA is about fairness. It is about reciprocity. It would provide 
U.S. exporters with the same market access to Central America that 
Central American exporters unilaterally received through the past 20 
years through various trade agreements. These trade agreements led to a 
one-sided lowering of tariffs. Currently, approximately 80 percent of 
Central America's exports enter the United States duty free. This 
unilateral tariff reduction helped Central American countries export to 
the United States but left U.S. producers facing steep and often 
prohibitive tariffs when they tried to export their own goods into 
Central America.
  With DR-CAFTA, more than 80 percent of U.S. manufacturing exports to 
the region will be duty free immediately, and the remaining tariffs 
will be phased out over 10 years, including the up to 15 percent 
tariffs on some of Ohio's top exports to the region such as chemicals, 
electrical equipment and appliances, machinery, plastics, rubber, 
paper, processed foods, and transportation equipment. For Ohio's 
agricultural producers, DR-CAFTA would eliminate tariffs on 50 percent 
of U.S. exports immediately and most remaining duties within 15 years.
  A perfect example of the benefits of DR-CAFTA is a situation faced by 
Heinz. Heinz has a catsup production facility in Fremont, OH, where 
they produce 80 percent of the catsup consumed in the entire United 
States. Heinz also produces numerous other condiments throughout the 
United States. Yet Heinz faces 15 to 47 percent tariffs on their 
products when they try to export to Central America. DR-CAFTA will 
change that. CAFTA will help ensure that the up to three generations of 
workers in Fremont, OH, in that factory will have jobs for themselves, 
jobs for their children when they grow up. This is just one example of 
why Ohio needs DR-CAFTA and why this entire country needs DR-CAFTA.
  Another good example is Polychem, located in Mentor, OH. They have 
been in business for over 30 years. They have grown to more than 200 
employees. They manufacture industrial strapping but cannot export into 
the Central American market competitively now because of high tariffs. 
DR-CAFTA would level the playing field for Polychem, allowing them to 
expand their exports and grow jobs in Ohio.
  By requiring Central American countries to lower their tariffs on 
U.S. products, the United States would be able to sell into a consumer 
base 45 million strong that already today buys American. The 45 million 
citizens represented by the DR-CAFTA agreement purchase today more U.S. 
goods than the 1.53 billion citizens of India, Indonesia, and Russia 
combined. DR-CAFTA will simply increase that.
  Not only do these consumers already buy America but, significantly 
for my State, they buy Ohio. In the past 5 years, Ohio exports to the 
DR-CAFTA region have grown by 90 percent, far outpacing their demands 
for exports from any other State in America. In 2004 alone, Ohio 
exported $197 million in manufactured goods to the region, including 
chemical and manufacturing goods, plastics, rubber products, fabric 
milled goods, electrical equipment, and appliances. These are just the 
largest categories. Each and every Senator could easily come to the 
Senate today and add a list similar to this.
  The list of DR-CAFTA support is long in my home State of Ohio. In 
Ohio, the Ohio Pork Producers Council, the Ohio Soybean Association, 
the Ohio Poultry Association, the Ohio Dairy Producers, the Ohio 
Cattlemen's Association, the Ohio Farm Bureau, the Ohio Farm Growers, 
and the Ohio Wheat Growers Association all support DR-CAFTA. Those are 
just the supporters in the Ohio agricultural sector.
  While many are helped by free trade, we understand whenever we have 
free trade legislation or free trade there are some individuals in 
society who are hurt. We need to make sure we always are concerned 
about them, that we pass legislation that assists them, and we must 
continue in this Congress to do that. Yet if we turn our backs on free 
trade, we would ultimately have far more unemployed Americans, and our 
economy would be a fraction of what it is today.
  For example, in the first year after the enactment of the United 
States-Chile Free Trade Agreement, Ohio's exports to Chile grew 20 
percent; and since NAFTA was enacted in 1993, Ohio's combined exports 
to Canada and Mexico have increased by more than 106 percent. More 
exports means more jobs for Ohio and more jobs for our country as a 
whole.
  Mr. President, as I said already, DR-CAFTA is good for Ohio, it is 
good for the United States. I urge my colleagues to vote in favor of 
this important free-trade agreement. But let me say one additional 
thing. As much as I support DR-CAFTA, there is something else that 
needs to be done, and that is this Congress needs to pass trade 
legislation that will assist the country of Haiti.

[[Page 15070]]

  Last year, the Senate passed an important trade bill for Haiti, only 
to see that trade agreement die in the House of Representatives. I have 
raised this issue with the administration and with my colleagues in 
both the House and the Senate. Haiti, the poorest country by far in our 
hemisphere, arguably needs our attention the most. To leave them out 
and to not pass trade legislation to assist them is shortsighted, it is 
wrong, and it is not helpful. We make a mistake by leaving them out.
  If nothing is done by this Congress soon to pass a trade agreement 
that will be of assistance to Haiti, it will really be a deathblow to 
what remains of Haiti's economy, and we will be seeing boats swollen 
with Haitians heading back to our shores again.
  Mr. President, I simply implore my colleagues, as well as the Bush 
administration, that after CAFTA is passed, we look again to 
legislation that I have proposed with many of my colleagues to be of 
assistance to Haiti. It is the right thing to do from a humanitarian 
point of view, but it is also the right thing to do from a foreign 
policy point of view as well.
  I thank the Chair and yield the floor.
  The PRESIDING OFFICER (Mr. Burr). Under the previous order, the 
Senator from West Virginia is recognized for 20 minutes.
  Mr. BYRD. Mr. President, I thank the Chair.
  Mr. President, on April 6 of this year, Senator Dorgan and I 
introduced S. Res. 100, a resolution to prevent a 2-year extension of 
the so-called fast track or trade promotion authority, which the 
Congress granted the administration in the Trade Act of 2002. If our 
resolution were approved, existing fast-track negotiating authority 
would expire this year. If only it would. If only it would. Wouldn't it 
be ideal if it would expire? I think so. But, instead, it will be 
extended through 2007. That is a crying shame.
  Senator Dorgan and I introduced that resolution of disapproval to 
fast track because we oppose giving any executive--any chief executive, 
Democrat or Republican--the unfettered authority to negotiate trade 
agreements such as CAFTA which cannot be amended by the Congress. It 
cannot be amended. All of this praise I hear of CAFTA--we have too 
little time here to consider and no time to amend. We cannot amend. Too 
little time. Too much praise. Too much short shrift. Too much short 
shrift is given to this, the Constitution of the United States, which I 
hold in my hand. Yes, too much praise, too little time, too much short 
shrift.
  I opposed fast track when it was used to negotiate the NAFTA; I 
opposed fast track when it was used to negotiate the Uruguay Round; and 
I oppose fast track today.
  Let me restate what I have said so many times--so many times--in the 
past, something that I think people may be finally beginning to 
comprehend. Article I, section 8 of this Constitution, which I hold in 
my hand, states that the Congress--hear me--that the Congress, not the 
executive, shall have the power to ``regulate Commerce with foreign 
Nations.'' And under Article I, section 7, the Senate is permitted to 
``propose or concur with'' amendments to all revenue bills.
  But under fast track--this shabby, shabby piece of trash--under fast 
track--this trumped-up power grab called fast track which is now 
disingenuously called trade promotion authority--listen to that: trade 
promotion authority--the Congress is left with no ability to modify the 
text of these trade agreements. And we did it to ourselves. Congress 
did it to itself. As a result, they are negotiated by a small band of 
bureaucratic gnomes--bureaucratic gnomes--accountable to whom? 
Accountable to no one, bureaucratic gnomes accountable to no one. But 
we should not blame them. We should blame ourselves. The Congress of 
the United States cut its own throat.
  Under fast track, the Congress cannot modify, the Congress cannot 
amend, the Congress cannot delete any section of trade agreements 
negotiated by the USTR. Congress is excluded from the process, just 
like we did to ourselves when we shifted the power to declare war to a 
President, one man. We did it to ourselves. We shifted power under this 
Constitution--lodged in the Congress, which shall declare war under 
this Constitution--we shifted that power to one man, and in so doing we 
relegated ourselves to the sideline.
  So today what can we say? We cannot say anything. We did it to 
ourselves. We said: Here, Mr. President, take it. It is yours, lock, 
stock, and barrel. That is what we did when it came to declaring war. 
And we are paying for it in Iraq.
  But let's get back on this matter. We did it to ourselves again. We 
excluded ourselves from the process. We cut ourselves out of the loop. 
We cast ourselves aside, like excess baggage, shunned, shunned like the 
woman who wore the scarlet letter.
  But unlike Nathaniel Hawthorne's Hester Prynne, who had to sport only 
one letter as a symbol of her wrongdoing, the shamed in this story 
should be forced to wear three letters to highlight their humiliation. 
And those letters are ``TPA,'' which stands for ``trade promotion 
authority.'' What a misnomer. How disingenuous can we become? Fast-
track negotiating authority is an abomination--an abomination.
  Is this what we think the Founding Fathers had in mind when they 
created our three separate branches of Government? We don't pay too 
much attention to that these days. Is this what they had in mind when 
they created our three separate branches of Government? First, in this 
Constitution, the legislative branch, then the executive branch, then 
the judicial branch. But that first branch, the people's branch, is 
this what they had in mind when they created that first branch? Blind 
adherence to agreements negotiated behind closed doors, dictated word 
for word by only one branch of the Government, the executive branch? Is 
that what they had in mind? That is not what the Constitution says. It 
says that the Congress shall regulate foreign commerce.
  But the Congress, like blind mice or hyperactive lemmings, time and 
time and time again just keeps on making the same mistake. It approves 
fast track. Each agreement negotiated under fast track destroys more 
American jobs and leads our Nation into deeper and deeper deficits.
  The overall U.S. trade deficit in 1993, when NAFTA was enacted, was 
$75.7 billion. Today what is it? Not $75.7 billion. It is nearly $700 
billion. Back in 1993--that hasn't been too long ago, back in 1993--the 
United States had a trade surplus with Mexico of $2.4 billion. Not too 
long ago, 1993. Look backward, O time, in thy flight. We had a trade 
surplus with Mexico of $2.4 billion in 1993, $2.4 billion. Last year we 
ran a trade deficit of $45 billion with Mexico. There you have it. The 
facts speak for themselves. Were these some of the promised benefits of 
NAFTA? It is too easy to forget. Were these some of the promised 
benefits of NAFTA? Sky high, yes, way up in the stratosphere, sky-high 
trade deficits? Since NAFTA and the Uruguay Round were negotiated under 
fast track, the United States has lost thousands--thousands, I say--of 
manufacturing and service jobs, a substantial portion of which have 
been outsourced--we hear much of that word these days, ``outsourced''--
to India or to China, leaving American workers' jobs without health 
care and with diminished pensions.
  I have seen it over and over again in West Virginia. I have seen it 
happen time and time and time and time again, firsthand, in West 
Virginia. It has happened in our steel industry in West Virginia. It 
has happened in the aluminum industry. It has happened in the glass 
industry. It has happened in the communications industry. It has 
happened in the special metals industry. It has happened in the 
furniture industry. It has happened in textiles. It has happened in 
handtools. Were these the promised benefits of NAFTA? Were these the 
promised benefits of the Uruguay Round? Who could have foreseen that 
these agreements would cause such massive dislocation, such grief? Who? 
Who?
  I will tell you who: Those of us who wisely voted against them. I 
did, and so did about a third of the U.S. Senate.

[[Page 15071]]

But the majority back then refused to see what was coming. The majority 
refused to look. The majority blindfolded itself and refused to see 
what was coming. I hope they recognize what they see today.
  Administrations like to allege that because they sometimes deign to 
``consult'' with the Congress on fast track trade agreements, their 
consultations satisfy the need of Congress to be involved in drafting 
the text of these agreements. We all know what a sham that is. Yes, 
they condescend to consult with Congress, the people's elected 
representatives. The President is indirectly elected by the electors, 
the representatives of the people. We are elected by the people, 
directly by the people. I come here, as it were, directly from the 
voting booth of the people. Despite all the assurances we heard during 
the 2002 trade debate, I have been told that even members of the 
Finance Committee, the Senate Committee that is charged with 
jurisdiction over trade matters, have been shut out. Can you believe 
it? Let me say that again. I can hardly believe what I am saying.
  Despite all the assurances we heard during the 2002 trade debate, I 
have been told that even members of the Senate Finance Committee, the 
Senate committee that is charged with jurisdiction over trade matters, 
have been shut out of substantive consultations on CAFTA. My, how the 
mighty have fallen. Since only certain members of the Finance Committee 
are part of the congressional oversight group which was supposedly 
created in 2002 to ``consult'' with the White House, other Senators on 
the Finance Committee who are not a part of that group have rarely been 
consulted on CAFTA at all. What kind of consultation is that? What 
kind?
  Similarly, the majority-controlled Senate Finance Committee refused 
to hold a hearing on the TPA resolution of disapproval that Senator 
Dorgan and I introduced in April. The committee also refused--maybe I 
should say ``declined''--to discharge the resolution so it could 
receive an up-or-down vote on the Senate floor.
  You hear that a lot around here, this demand for an up-or-down vote. 
I hear it said that nominees deserve an up-or-down vote. Who said that? 
The President and others say the nominees deserve an up-or-down vote. 
The Constitution doesn't say that. Here is the Constitution. It doesn't 
say that. What do the American people deserve? That is what counts.
  Well, the Senate leadership refused to give our resolution an up-or-
down vote. Instead, they killed it in committee. It died a natural 
death. They killed it in committee, despite a written request asking 
for its discharge that was sent by Senators Dorgan, Graham, 
Rockefeller, Johnson, Levin, Inouye, Dayton, and myself.
  The proponents of fast track, TPA, and CAFTA argue that by expanding 
free trade in Central America we will help the workers in those 
countries--I have heard some of that today--become more stable and less 
of a national security threat. That is what we were told about NAFTA. 
What happened? Did NAFTA stabilize immigration? No. Since NAFTA was 
implemented, the number of those migrating illegally into the United 
States to seek work has doubled. Perhaps this is because the wages of 
Mexican workers have declined and the number of people in poverty there 
has grown.
  Yet the administration wants us to enact now another NAFTA, this time 
called CAFTA--NAFTA, CAFTA; NAFTA CAFTA. Poetic, isn't it? It has a 
rhyming sound. NAFTA, CAFTA. Yesterday NAFTA, today CAFTA, what the 
AFL-CIO tells us will not require its members to maintain or improve 
their labor laws or to protect the core labor rights of their workers.
  So the administration continues to negotiate these failed free-trade 
agreements, when it should be focusing on the real trade crises that 
face our Nation.
  For example, while the administration has been spending its resources 
on these agreements, it is doing nothing to address our Nation's 
enormous trade deficit, which soon will surpass $700 billion. What a 
deficit--$700 billion.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. BYRD. I am so sorry about that, Mr. President. I ask unanimous 
consent that I may be given 5 more minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BYRD. I thank the Chair for his courtesy. May I say that the 
chairman of the Finance Committee is a man whom I like. He is always 
friendly, always courteous to me, and in Shakespeare's words, ``He's a 
man after my own kidney.''
  The administration also refuses to bring WTO cases against other 
countries that violate international law. Yet it acquiesces when the 
WTO unfairly and deliberately twists international rules to strike down 
our own laws. In fact, the current administration has taken on only 12 
cases to the WTO in over 4 years, compared with its predecessor, which 
filed an average of 11 WTO cases per year.
  The U.S. Trade Representative sits idly by while the WTO tries to 
undermine and/or eliminate our most critical trade laws, including the 
Continued Dumping and Subsidy Offset Act, also known as the Byrd 
amendment. A strong majority of the Senate supports the Byrd amendment, 
and this law will not be repealed or modified in response to the WTO. 
In fact, in the fiscal year 2004 and 2005 Consolidated Appropriations 
Acts both Houses of Congress directed the administration to start 
negotiating a solution to this WTO dispute. In response to this 
congressional mandate, the administration, in early 2004, submitted a 
proposal to a negotiating group in Geneva to reverse this WTO ruling 
against our law. But the administration has done nothing to advance 
those negotiations since April 2004. The administration needs to stop 
stalling and start solving this problem.
  History shows that it is a big mistake for the Congress to cede its 
authority to negotiate trade agreements to the Executive--and I am not 
just talking about this administration. I have been in Congress 53 
years, and it is the same in every administration, Democratic and 
Republican. They follow the State Department line all the time--because 
the outcome of those agreements can have disastrous consequences for 
American industry.
  How much more negative history, how many more flawed consequences 
must our Nation suffer before we wake up and realize that fast track 
has been a disaster? Instead of negotiating more unfair, at any rate, 
agreements such as CAFTA, we should be fighting aggressively to 
preserve our Nation's trade laws and to protect the American workers 
and their families, and also protect the Constitution of the United 
States.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Chair recognizes the Senator from North 
Carolina.
  Mr. BURR. Mr. President, I probably won't be as eloquent as the 
senior Senator from West Virginia, but rest assured that I am just as 
passionate about the issue before this body.
  I rise today, after months of countless discussions with interested 
parties, farmers, manufacturers, textile workers, and small businesses, 
to voice my support for the Central American Free Trade Agreement. It 
is not a decision that I have reached lightly.
  While some in my State continue to raise concerns with this agreement 
and trade in general, I believe this agreement is in the long-term best 
interests of North Carolina and our Nation. When I wake up in the 
morning, I look forward, I don't look back; I look to the future. 
Simply put, Mr. President, voting no on this agreement would be the 
easy thing to do. However, I believe voting yes is, in fact, the right 
choice for the State of North Carolina and its economic future.
  It is only through agreements with our friends, neighbors, and allies 
that we will be able to compete with Asia. Many will argue that this 
agreement is a jobs loser, and I certainly understand that feeling and 
respect those opinions. After all, my home State of North Carolina is 
undergoing a significant economic transition which is changing the 
nature of our job market. However,

[[Page 15072]]

I believe CAFTA will provide opportunities for economic growth in my 
State down the road.
  CAFTA will provide garment makers in the region with a critical 
advantage in competing with Asia--particularly Chinese--garment 
manufacturers. This is crucial for one very important reason: those 
regional garment makers buy their yarn, their fabric, from American 
companies. Many of those companies are based in North Carolina. Those 
American companies buy their cotton from American farmers. This is not 
the case in Asia.
  I am persuaded by the impressive level of trade between North 
Carolina and Central America today. North Carolina exported almost $2 
billion worth of merchandise to Costa Rica, Dominican Republic, El 
Salvador, Guatemala, Honduras, and Nicaragua in 2004 alone. Only 
Florida and Texas exported more. My State's exports to the region last 
year accounted for almost 10 percent of our total exports. These 
exports translate into real jobs in North Carolina.
  I am also persuaded by the side agreements that I know the President 
is well aware of--side agreements intended to address shortcomings in 
the underlying agreement. Our new Trade Representative, my friend, Rob 
Portman, has committed he will utilize the CAFTA amendment mechanism to 
pursue a rule-of-origin change for pockets and linings, helping ensure 
that $100 million in U.S. pocketing and lining exports to the region 
are not lost. The administration has also reaffirmed its commitment to 
negotiate an aggressive customs enforcement agreement with Mexico 
before the cumulation provisions of CAFTA can be used. Finally, 
Nicaragua has committed to allocate its trade preference levels, or 
TPLs, to its current nonqualifying U.S. trade, ensuring that existing 
U.S. business is not impacted by this provision.
  I am not the only one persuaded by these side agreements. On June 27, 
10 organizations, representing textile and apparel businesses, wrote 
Members of the House and Senate in support of CAFTA. Those 
organizations wrote:

       This agreement is vitally important for the United States 
     textile and apparel industry and the more than 600,000 
     workers who are still employed in the United States in this 
     industry.

  I ask unanimous consent, Mr. President, that this letter be printed 
in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                    June 27, 2005.
       Dear Senator/Representative: We are writing to express our 
     strong support for and urge passage of the implementing 
     legislation (HR 3045/S 1307) for the U.S.-Central America-
     Dominican Republic Free Trade Agreement (CAFTA-DR).
       This agreement is vitally important for the U.S. textile 
     and apparel industry and the more than 600,000 workers who 
     are still employed in the United States in this industry.
       Last year, we exported more than $4 billion of textile and 
     apparel products to Central America and the Dominican 
     Republic. More than 25 percent of all U.S. fabric exports and 
     40 percent of all U.S. yarn exports go to this region. As a 
     result, garments imported from the region contain on average 
     more than 70 percent U.S. content. In contrast, garments 
     imported from Asia contain less than 1 percent U.S. content.
       Recent changes in the international trade regime--through 
     the elimination of quotas have eroded the competitiveness of 
     the partnership we now have with Central American region. 
     Moreover, the existing program--because of burdensome 
     documentation requirements and because it will expire soon--
     no longer provides as strong an incentive to make clothing in 
     the region using U.S. inputs.
       CAFTA-DR will solidify and stabilize this partnership by 
     making the current program broader, easier to use, more 
     flexible, permanent, and reciprocal. It will create new sales 
     opportunities for U.S. textile and apparel products by 
     providing permanent incentives for the use of U.S. yarns and 
     fabrics in textile articles made in the region. And because 
     it will promote duty free access for U.S. textile and apparel 
     exports to local markets in the region--which currently does 
     not exist--it will give us new advantages over our 
     competitors.
       For all these reasons, textile and apparel companies from 
     across the supply chain have come together to express support 
     for CAFTA-DR and to urge its swift approval.
       On behalf of the U.S. companies we represent and the 
     workers they employ, we urge you to support the agreement and 
     vote YES on the CAFTA-DR.
           Sincerely,
       American Apparel & Footwear Association (AAFA),
       American Cotton Shippers Association (ACSA),
       American Fiber Manufacturers Association (AFMA),
       American Textile Machinery Association (ATMA),
       Association of the Non Woven Fabrics Industry (INDA),
       National Cotton Council (NCC),
       National Council of Textile Organizations (NCTO),
       Sewn Products Equipment & Suppliers of the Americas 
     (SPESA),
       Textile Distributors Association (TDA),
       United States Hosiery Manufacturers Coalition (USHMC).

  Mr. BURR. Mr. President, North Carolina textile and apparel firms are 
by no means unanimous in their support of CAFTA. I clearly understand 
that. But when companies as diverse as Sara Lee, Russell, Glen Raven, 
National Textiles, and Parkdale, companies that have not agreed before, 
agree on this, we should take notice, and I have.
  Without CAFTA, more and more garment manufacturing will simply find 
its way to China to be manufactured. As Central American manufacturers 
are forced out by Chinese manufacturers, more American jobs will be put 
at risk for the simple fact that Chinese manufacturers do not use 
American yarn, they do not use American fabric, and they do not use 
American cotton.
  I am persuaded by agriculture's support for this agreement, and in a 
letter to me recently, North Carolina's Farm Bureau president Larry 
Wooten said:

       On balance, the CAFTA-DR is a positive trade deal for North 
     Carolina agriculture. It will boost our State's number one 
     industry by helping North Carolina's farm families develop 
     new markets for their products. North Carolina Farm Bureau 
     strongly supports CAFTA-DR.

  Mr. President, I ask unanimous consent that this letter be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
                                        North Carolina Farm Bureau


                                                   Federation,

                                       Raleigh, NC, June 30, 2005.
     Hon. Richard Burr,
     U.S. Senate,
     Washington, DC.
       Dear Senator Burr: As the U.S. Senate prepares to vote 
     today on the Central America--Dominican Republic Free Trade 
     Agreement (CAFTA-DR), I am writing you to express North 
     Carolina Farm Bureau's support for this important agreement. 
     Thank you for your vote last night to invoke cloture on S. 
     1307, and we hope you will vote for this measure again on 
     final passage today.
       Currently, U.S. agriculture faces a $700 million trade 
     deficit with the six countries included in the CAFTA-DR. This 
     is largely the result of the General System of Preferences 
     (GSP) trade provisions and the Caribbean Basin Initiative 
     (CBI), which together allow 99 percent of Central American 
     and Dominican Republic agricultural products to enter U.S. 
     markets duty free. Conversely, U.S. exports to the region are 
     subject to applied tariffs that range from 15 to 43 percent. 
     Indeed, North Carolina's farm families have already paid for 
     this agreement.
       CAFTA-DR will eliminate these trade barriers, and provide 
     North Carolina farmers and agribusinesses with the same duty-
     free access that CAFTA-DR countries already enjoy in our 
     markets. In fact, many U.S. competitors in the region, like 
     Chile, already receive preferential access from the CAFTA-DR 
     countries.
       A News & Observer article published earlier this year 
     reported that, according to the U.S. Department of Commerce, 
     North Carolina exports to the CAFTA-DR countries grew by $678 
     million from 2001 to 2004, the largest increase in the 
     nation. The article went on to say that North Carolina is the 
     CAFTA-DR region's third largest trading partner behind Texas 
     and Florida. Clearly, North Carolina agriculture has much to 
     gain from CAFTA-DR's enactment.
       According to a recent study conducted by the American Farm 
     Bureau Federation (AFBF), II CAFTA-DR is a good deal for 
     North Carolina agriculture. In 2003, North Carolina's farm 
     cash receipts equaled $6.9 billion. Of that figure, $1.3 
     billion, or about 19 percent, came from agricultural exports. 
     If CAFTA-DR is enacted, AFBF estimates that North Carolina 
     will increase agriculture trade to this region by nearly $70 
     million per year by 2024.
       As you know, North Carolina is a major producer of pork, 
     poultry, and cotton, as well as a significant producer of 
     soybeans. Under CAFTA-DR, North Carolina could expect to 
     increase meat exports to CAFTA-DR nations by $24 million per 
     year once the agreement is fully implemented. Poultry, our 
     third largest agricultural export, would

[[Page 15073]]

     experience export increases of $42 million per year. Exports 
     of cotton would increase approximately $1 million per year, 
     while soybeans and soybean product exports would grow by 
     $770,000 per year.
       It is important to remember that the global community is 
     closely monitoring congressional deliberations regarding 
     CAFTA-DR. Rejecting this agreement will damage U.S. 
     credibility in the World Trade Organization (WTO) and deter 
     other nations from negotiating future trade agreements with 
     us. Further, failing to approve CAFTA-DR and any subsequent 
     trade agreements will exert more pressure on Congress to 
     increase Farm Bill spending.
       On balance, the CAFTA-DR is a positive trade deal for North 
     Carolina agriculture. It will boost our state's number one 
     industry by helping North Carolina's farm families develop 
     new markets for their products. North Carolina Farm Bureau 
     strongly supports CAFTA-DR, and we urge you to support on the 
     Senate Floor today.
       As a friend of North Carolina Farm Bureau, you have always 
     been accessible and I appreciate your support for North 
     Carolina's farm families. As you consider how you will vote 
     on this critical matter, please know that I stand ready to 
     assist you in any way. I look forward to hearing from you 
     soon.
           Sincerely,
                                                  Larry B. Wooten,
                                                        President.

  Mr. BURR. Mr. President, current agricultural trade between the 
United States and the region can be a one-way street. That street is 
often closed to our farmers by regional barriers. CAFTA will remove 
those barriers, increasing access for U.S. farmers. With exports 
accounting for 20 percent of North Carolina's farm cash receipts, 
almost $1.5 billion, my State's farmers stand to make tremendous gains 
in Central American markets.
  The key to making this trade agreement an economic success for North 
Carolina, though, is enforcement. I am a proponent of free trade, but I 
am an even bigger proponent of fair trade. The rules must be enforced. 
I intend to make sure that neither this Nation nor our partner 
countries turn a blind eye to the provisions set out and the assurances 
made in CAFTA.
  Several of my colleagues have come down to the Senate floor to 
express their concerns with China. Let me be specific. I have concerns 
about China, too. I voted against normal trade relations status for 
China eight times as a Member of the other body. Hindering our Nation's 
trade with other nations to get back at China is not the answer. 
Enforcing our laws and enforcing the provisions of the trade agreement 
with China is the answer to China.
  If I held up a chart today and suggested that chart listed every time 
China had voluntarily broken our trade agreements, it would be blank. 
If we want trade to work, we as a country have to enforce the 
agreements we have with our partners.
  This is not the China free-trade agreement. It is the Central 
American Free Trade Agreement. We need to stop holding our friends in 
Central America and elsewhere accountable for China's unlawful 
practices. We should not let China get away with unfair trade 
practices, and we must strengthen our trade enforcement efforts. If 
China is going to break the rules, let's call them on it. Let's make 
them pay for it. But we should not make other countries the scapegoat 
for China.
  In the 2 years since CAFTA was signed, I have worked to better 
understand the agreement and the impacts it will have on my State. 
Today I am convinced there is no choice--no choice--but to look to the 
future and approve this agreement. The new and emerging sectors of 
North Carolina's economy, from computer manufacturing to biotechnology 
and established sectors such as financial services and agriculture, 
depend on agreements such as this.
  What makes CAFTA fairly unique is the recognition by many in the 
textile and apparel industry that CAFTA represents one of their last, 
best chances to compete with Asia. We cannot afford to wall ourselves 
off from the rest of the world if we hope to compete in a global 
marketplace and to create jobs in the United States.
  I urge my colleagues to look at the long-term benefits of prosperous, 
successful, established democracies to our south and the economic 
opportunities it provides for our own citizens here. If we fail to look 
to our friends in the south, we will only be strengthening our 
competitors to the west.
  I urge my colleagues at the end of this debate to vote in favor of 
the CAFTA agreement, and I urge my colleagues to stay vigilant, whether 
it is CAFTA or China, as it relates to enforcement mechanisms with our 
trade partners.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. Mr. President, I ask unanimous consent that I be 
allowed to speak for up to 15 minutes and that the time be charged 
under the control of Senator Grassley.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from California may proceed.
  Mrs. FEINSTEIN. Mr. President, I have been listening to the debate 
upstairs on television. I thought I might come down and indicate the 
reasons I am going to vote for this Central American Free Trade 
Agreement.
  This agreement has sparked a great deal of debate about our trade 
agenda, the effects of trade agreements on labor rights and the 
environment, and the impact of increased imports on sensitive domestic 
industries. I understand the concerns of my colleagues, including 
members of my own party, who do not support this agreement.
  For me, I have always approached these agreements on a case-by-case 
basis. I have supported some, and I have opposed others. For example, I 
opposed the North American Free Trade Agreement and the Singapore-Chile 
Free Trade Agreement. I opposed NAFTA because of the concerns about the 
impact of jobs and the environment, and I opposed the Chile-Singapore 
Free Trade Agreement because of the inclusion of immigration 
provisions.
  But in my view, this is an important opportunity for this Congress to 
go on record in support of economic growth and political stability in 
these countries and new markets and opportunities for our manufacturers 
and farmers.
  Bottom line, this agreement provides immediate benefits for American 
exports. It balances an uneven trading relationship. Some have said 
this, but I do not think it has sunk in: approximately 80 percent of 
goods manufactured in these countries and 99 percent of their 
agricultural products already enter the United States duty free. But 
America's exports into these countries face stiff tariffs on a number 
of key products. Let me give some examples.
  Wood products have an average tariff of 10 percent; motor vehicles 
and parts, an average of 11.1 percent; vegetables, fruits, and nuts, an 
average of 16.7 percent--that is today--dairy products, an average of 
19.5 percent and up to 60 percent in some cases. In some cases, to send 
dairy products into these countries, they face a tariff of 60 percent; 
grains, an average tariff of 10.6 percent; beef, up to 30 percent; 
rice, up to 60 percent; and wine is as high as 35 percent.
  Upon enactment of this agreement, 80 percent of U.S. industrial 
exports will enter the CAFTA countries duty free, with the remaining 
tariffs eliminated over 10 years. That is good for us. That is good for 
our workers because in these industries it will produce more jobs. 
Fifty percent of agricultural exports become duty free immediately, 
with remaining tariffs eliminated over 15 and 20 years.
  A World Bank and University of Michigan study estimates that with the 
agreement, U.S. income will rise by $17 billion and the income of CAFTA 
countries by $5 billion. I think that is substantial. According to the 
American Farm Bureau, CAFTA would increase U.S. agricultural exports by 
$1.5 billion annually.
  Now let me just talk about my own State of California. It has often 
been said we are the fifth largest economic engine on Earth. We have a 
$1.4 trillion economy. We are a leader in U.S. and global markets, with 
products ranging from high tech to agriculture. Our workers, our 
farmers, and our businesses need access to new and expanding markets to 
sustain that leadership position.
  In 2004, my State exports to the CAFTA countries totaled $660 
million. That was the sixth largest of the 50 States. Manufactured 
goods accounted

[[Page 15074]]

for 89 percent of the total, including computers and electronic 
equipment, fabric mill products, and coal products.
  CAFTA will provide significant opportunities for several California 
export industries. Let me go over them. Let us take dairy, for example. 
California's producers represent a $4 billion dairy industry. We know 
it is the largest in the Nation. Their exports face duties as high as 
60 percent today. Each country in this agreement establishes tariff 
rate quotas for certain dairy products totaling 10,000 metric tons 
across the six CAFTA countries. Access will increase by 5 percent a 
year for the Central American countries and 10 percent a year for the 
Dominican Republic, and all duties will be eliminated over 20 years.
  Beef: Current duties on beef are as high as 30 percent. Duties on 
prime and choice cuts will be eliminated immediately in the Central 
American countries. Duties on other beef products will be phased out 
over 5 to 10 years.
  Wine: Current duties on American wine are as high as 35 percent. 
Duties on standard size U.S. bottled wine will be eliminated 
immediately. All others will be phased out over 15 years.
  Rice: Currently, U.S. rice exports face tariffs of up to 60 percent. 
Under the agreement, each country will establish a tariff rate quota 
for milled rice and rough rice, except for the Dominican Republic, 
which will have a tariff rate quota for brown rice. In the first year, 
400,000 metric tons will be imported duty free, growing as the tariff 
is eventually eliminated.
  Fruits: Duties of up to 20 percent on U.S. grapes, raisins, fresh and 
canned peaches, and fresh and canned pears will be eliminated 
immediately upon enactment of the agreement.
  Tree nuts: Duties of up to 20 percent on U.S. walnuts, almonds, and 
pistachios will be eliminated immediately upon enactment of the 
agreement.
  Services: The agreement provides broad market access and regulatory 
transparency for telecommunications, insurance, financial services, 
distribution services, computer and business technology services, and 
tourism, among others. U.S. financial service suppliers will have full 
rights to establish subsidiaries, joint ventures or branches for banks 
and insurance companies.
  High tech: The agreement eliminates distribution barriers for 
information technology products. It requires countries to eliminate 
information technology tariffs by signing the World Trade Organization 
Information Technology Agreement, and it opens up information 
technology services. All exports of products covered by the Information 
Technology Agreement, including computer equipment and communications 
equipment, will receive immediate duty-free treatment.
  Entertainment: California is a big entertainment State, and this is 
very important. The agreement provides for increased market access for 
U.S. films and television programs through cable, satellite, and the 
Internet. Currently, movies face tariffs ranging from 5 to 20 percent. 
Compact discs and DVDs face tariffs of up to 10 percent. The agreement 
provides for zero tariffs on movies, music, consumer products, 
software, books and magazines, and nondiscriminatory treatment for 
digital products such as U.S. software, music, text, and videos. It 
also includes protections for U.S. trademarks, copyrighted works, 
patents, trade secrets, and penalties for piracy and counterfeiting. As 
a matter of fact, Peter Chernin, the CEO and president of the Fox 
Group, said this: This agreement sets a template for what agreements 
should look like.
  Textiles: Apparel from garment factories in Central America 
supporting 400,000 jobs will be duty free and quota free in the United 
States if they contain U.S. fabric and yarn, thus benefiting U.S. 
fabric and yarn exports. The CAFTA countries are the largest market for 
U.S. apparel and yarn exports. That is $2.2 billion in 2003. Tariffs on 
U.S. textile exports are currently 18 percent, and they will be 
eliminated immediately upon enactment of the agreement.
  Now, these are all win-win-win for my State and I believe for the 
United States. Perhaps because of the NAFTA agreement, which was a very 
different agreement, people look at this agreement as they looked at 
NAFTA. In fact, CAFTA countries now export most of their products into 
the United States at no tariff, and most of our products face tariffs 
which would either be eliminated immediately or eliminated over a 
period of time under CAFTA.
  So I do not think it should come as any surprise that there is very 
wide support among California businesses, farmers, and agricultural 
organizations: the Farm Bureau, the Wine Institute, the United 
Dairymen, the Rice Commission, the Cattlemen's Association, the Pork 
Producers, the Table Grape Commission. In high tech, virtually every 
company: Cisco, Intel, National Semiconductor, Apple, Oracle, Hewlett-
Packard, Qualcomm, IBM, Kodak, and the Telecommunications Industry of 
America. This is opening markets for our products. Entertainment: the 
Motion Picture Association of America, the Recording Industry of 
America, the Independent Film and Television Alliance, and the 
Entertainment Software Association.
  As the New York Times stated in an editorial:

       Denying poor people in Central America the benefits of 
     better access to the American market is certainly not the way 
     to lift them out of poverty.

  That is the flip side of this, that by creating an agreement that 
reduces these tariffs on American products, a more competitive and 
higher quality marketplace is produced for citizens of these countries, 
and that is not bad.
  Denying these countries access to the U.S. market is certainly not 
the way to reward them for advances made in the area of democracy, 
human rights, and the rule of law. Twenty years ago, these countries 
were marred by constant warfare, human rights abuses, poverty, and 
political instability. Since then, they have all made enormous strides, 
and passage of CAFTA will not only promote economic development and 
rising standards of living by allowing their products to compete in the 
U.S. market, it will also lock in economic reforms, respect for the 
rule of law, and solidify democratic institutions. Each country now has 
a democratically elected leader, and I think we should reward those 
allies and not turn our backs on them.
  I ask unanimous consent to have a letter from former President Jimmy 
Carter printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                     June 8, 2005.
     Hon. Charles E. Grassley,
     Hart Senate Office Building,
     Washington, DC.
       To Senator Charles Grassley: As you prepare for your 
     initial consideration of the Central American Free Trade 
     Agreement (CAFTA) with the nations of Central America and the 
     Dominican Republic, I want to express my strong support for 
     this progressive move. From a trade perspective, this will 
     he1p both the United States and Central America.
       Some 80 percent of Central America's exports to the U.S. 
     are already duty free, so they will be opening their markets 
     to U.S. exports more than we will for their remaining 
     products. Independent studies indicate that U.S. incomes will 
     rise by over $15 billion and those in Central America by some 
     $5 billion. New jobs will be created in Central America, and 
     labor standards are likely to improve as a result of CAFTA.
       Some improvements could be made in the trade bill, 
     particularly on the labor protection side, but, more 
     importantly, our own national security and hemispheric 
     influence will be enhanced with improved stability, 
     democracy, and development in our poor, fragile neighbors in 
     Central America and the Caribbean. During my presidency and 
     now at The Carter Center, I have been dedicated to the 
     promotion of democracy and stability in the region. From the 
     negotiation of the Panama Canal Treaties and the championing 
     of human rights at a time when the region suffered under 
     military dictatorships to the monitoring of a number of free 
     elections in the region, Central America has been a major 
     focus of my attention.
       There now are democratically elected governments in each of 
     the countries covered by CAFTA. In negotiating this 
     agreement, the presidents of each of the six nations had to 
     contend with their own companies that fear competition with 
     U.S. firms. They have put their credibility on the line, not 
     only with this trade agreement but more broadly by promoting 
     market reforms that have been urged for decades by U.S. 
     presidents of both

[[Page 15075]]

     parties. If the U.S. Congress were to turn its back on CAFTA, 
     it would undercut these fragile democracies, compel them to 
     retreat to protectionism, and make it harder for them to 
     cooperate with the U.S.
       For the first time ever, we have a chance to reinforce 
     democracies in the region. This is the moment to move forward 
     and to help those leaders that want to modernize and humanize 
     their countries. Moreover, strong economies in the region are 
     the best antidote to illegal immigration from the region.
       I appreciate your consideration of my views and hope they 
     will be helpful in your important deliberations.
           Sincerely,
                                                     Jimmy Carter.

  Mrs. FEINSTEIN. Former President Jimmy Carter states:

       If the United States Congress were to turn its back on 
     CAFTA, it would undercut these fragile democracies, compel 
     them to retreat to protectionism, and make it harder for them 
     to cooperate with the United States.

  I do not think there has been any American President that has reached 
out more fully to the rest of the world with more humanitarian work and 
more concern about human rights and labor rights than Jimmy Carter.
  I understand several of my colleagues believe labor and environmental 
provisions of the agreement fall short of what is needed to protect 
workers' rights and the natural resources of the CAFTA countries. I 
think free-trade advocates often make the mistake of arguing that these 
agreements are a panacea for the ills of the developing world, 
including lax labor and environmental standards. I certainly do not 
believe that.
  The passage of the CAFTA alone will not bring labor and environmental 
standards and the capacity to enforce those standards up to United 
States levels. We have to admit that. But--and I say ``but''--combined 
with a robust assistance package to help the CAFTA countries identify 
shortcomings and improve the enforcement of their laws, this agreement 
will mark an important step in the right direction. This is not about 
sacrificing the rights of workers and the protection of the environment 
for open markets and increased trade. We can provide new opportunities 
for American and Central American goods and services and establish 
programs to help those countries raise their labor standards.
  What Senator Bingaman said when he came to the floor is very 
constructive. I give him a great deal of credit and credit to the 
administration. This is the first trade treaty I can remember when they 
have been open to change.
  Mr. President, I ask unanimous consent just 5 additional minutes.
  The PRESIDING OFFICER (Mr. Burr). Without objection, it is so 
ordered.
  Mrs. FEINSTEIN. This is the first trade agreement where the 
administration, perhaps because they have had to struggle for the 
votes, has been welcoming of suggestions; not only welcoming of 
suggestions, they made some changes. That is appreciated.
  One of the changes was $40 million earmarked for labor and 
environment capacity building for the CAFTA countries, from 2006 
through 2009, and $3 million annually through 2009 for the 
International Labor Organization to monitor and verify progress in 
CAFTA countries in improving labor law enforcement and working 
conditions, with periodic reports that are transparent, every 6 months, 
on such projects.
  That is a first and I think it is important and I do believe it can 
make a difference. I do believe the comments of those who are concerned 
about impact on Central America's labor laws are right to be concerned. 
I join them in that concern. This $3 million can go a long way to 
seeing the kind of enforcement that is necessary to begin to bring 
those countries up to where it is an approximately level playing field. 
This is a significant commitment, and I thank Ambassador Portman for 
his willingness to engage with the Congress on this issue.
  I also look forward to providing assistance to workers in this 
country through the Trade Adjustment Assistance Program for those who 
have lost their jobs because of increased trade.
  This is where I think the rub really is. It is always hard to see 
whether the benefits of free trade do in fact outweigh the negatives. 
But we must recognize that some workers lose their jobs and they have 
to be helped to learn new skills. We have to find ways to keep 
manufacturing in this country. We have to find ways to limit research 
and development tax credits to the production of jobs in this country.
  Some of us were struck a mortal blow when we repatriated tax funds 
and there was an amendment on the floor of the Senate that said ``as 
long as those funds will be used for production of jobs in this 
country,'' and that amendment failed. That, for me, was a dark day 
because I believe that American corporations do have an obligation to 
this country, not only to the bottom line but an obligation to their 
workers. American workers are the best in productivity and the best in 
the world. We have to find ways to see that this country is competitive 
in education, in standards, to be attractive for manufacturing once 
again.
  Today, the Democrats in the Democratic Policy Committee heard a very 
interesting presentation which pointed out how necessary manufacturing 
jobs, production line jobs--not high-skilled jobs--were going to be to 
the future of this great country. I remember when I was mayor of San 
Francisco, Akio Morita, the chairman of Sony, at that time he was the 
head of The Keidanren, saying to me that when America loses its 
manufacturing edge, it is the first step to America becoming a second 
rate power. I believe that is correct. Yet a trade agreement which 
reduces tariffs on our exports is not bad; it is good. I think that is 
the benefit of that, and of this agreement.
  With that in mind, and because I believe virtually every industry in 
my State is in support of this agreement, I intend to vote aye.
  I thank the Chair for the extension of time, and I yield the floor.
  I appreciated the recent efforts the administration made to engage 
the sugar industry to work out an agreement. However, I am concerned 
that the two sides only recently came to the table to address this 
divisive issue. The trade agreement has been signed for nearly a year, 
but talks only began about 3 weeks ago. The problem should have been 
recognized and truly addressed earlier in the process. I am convinced 
that an agreement could have been reached. As it was, the sugar 
industry chose not to accept a short-term offer by the administration. 
The offer would have provided a remedy for the length of the farm bill, 
this year and next year's sugar beet crop. As I stated before, sugar 
beet farmers in Wyoming have made long-term investments in their 
processing facilities. They need a long-term solution, not a short-term 
fix.
  This problem will not go away. As the administration continues to 
seek additional free-trade agreements with countries that desire to 
send their sugar to our markets, this issue will resurface. I recommend 
that the administration and the sugar industry continue creative 
discussions to identify a long-term solution beyond the next farm bill 
to ensure the viability of the sugar industry and the small family 
farmers that the industry supports in the United States.
  Beyond Wyoming sugar, Wyoming cattle producers have made it clear to 
me that they want mandatory country of origin labeling implemented 
before new trade agreements are signed that could bring in additional 
beef and meat products. I agree that consumers should have the 
opportunity to make an informed purchase regarding their meat's country 
of origin at their grocery store. U.S. beef is competitive, but it does 
not receive a chance to compete when it is not labeled as U.S. beef for 
consumers.
  With my vote against this bill, it would be easy for my opponents to 
cast me as a free-trade obstructionist. I remind them that until today, 
I have never voted against a free-trade agreement on the floor of the 
Senate. The principles of fair trade, which I support, generally bring 
about increased democracy, more transparency in Government and 
increased productivity. Along these lines, there are industries in 
Wyoming that communicated their support of CAFTA to me. I am pleased 
the agreement will improve market access for important industries, such 
as

[[Page 15076]]

soda ash and oil and gas. I recognize the benefits this agreement will 
bring to many and applaud the administration for their hard work in 
bringing this agreement to fruition. Unfortunately, I cannot vote for 
the agreement today because the costs outweigh the benefits for my 
State as a whole.
  Mr. ENZI. Mr. President, I rise today to express my opposition to the 
Dominican Republic-Central American-United States free trade agreement, 
known as CAFTA. I am opposing the implementing legislation before the 
Senate today due to the negative impact that passage of the agreement 
will have on the domestic sugar industry. I also believe mandatory 
country of origin labeling should be implemented before we sign trade 
agreements that will bring in additional meat products.
  The production of sugar is vitally important in Wyoming. Behind hay, 
which is fed to our livestock, sugar beets is the No. 1 cash crop in 
Wyoming. So small sugar beet farms in Wyoming have a big impact on my 
State's economy. For example, my office received calls from bankers and 
local economic development agencies in towns that depend upon the 
viability of the sugar beet industry. They were concerned about the 
impact of CAFTA on the health of their local economies--the economies 
of my home State.
  In addition, the sugar industry is vertically integrated. Sugar beet 
farmers are invested in their land and specialized farming equipment. 
However, across the Nation, sugar beet farmers have also banded 
together to purchase the processing plants that add value to their 
crop. So their investment in sugar is higher than the investments of 
other farmers in their crops. Many of these plants have been purchased 
in recent years with a long-term debt load. Wyoming sugar beet farmers 
have a special interest in ensuring that their industry has long-term 
viability. The sugar that would be imported from CAFTA countries under 
this agreement, in addition to the sugar expected to be imported from 
Mexico under NAFTA, would have a detrimental impact on the sugar beet 
industry in the near and distant future.
  The PRESIDING OFFICER. Who yields time? The Senator from Connecticut.
  Mr. DODD. Mr. President, I ask unanimous consent I be allowed to 
speak for up to 30 minutes from the time under the control of Senator 
Dorgan, to be followed by Senator Martinez for up to 10 minutes from 
the time under the control of Senator Grassley.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Connecticut is recognized for 30 minutes.
  Mr. DODD. Mr. President, let me begin by commending, again, the 
chairman of the Finance Committee, Senator Grassley, and Senator 
Baucus, the ranking Democrat, and members of that committee. It is a 
very important committee of the Senate, obviously. They are charged 
with the responsibility of dealing with trade agreements. The 
implications of these trade agreements obviously go beyond just the 
jurisdiction of the Finance Committee. It can be argued, I think very 
correctly, that these agreements have huge foreign policy implications, 
national security implications as well as, obviously, labor 
implications. So the Finance Committee is asked to grapple with very 
compelling issues that touch on a lot of other subject matters when 
they deal with it.
  I rise today to speak about this Central America-Dominican Republic 
Free Trade Agreement, known as the CAFTA-DR agreement. Yesterday 
evening, I came to the floor to express my hopes that this agreement 
could be strengthened in the waning hours before a vote on its 
implementing legislation. I did so because I very much want to support 
this agreement.
  Let me explain why again. Many of my colleagues, I suppose, know the 
reason. As long as I have been a Member of this body I have served on 
the Senate Foreign Relations Committee. I have, for most of those 
years, been either the chairman or the ranking Democrat of the 
subcommittee dealing with Latin America.
  My colleagues, many of them, know as well that some 39 years ago, as 
I finished my college education, I joined the Peace Corps and traveled 
to the Dominican Republic where, for about 2 years I served as a Peace 
Corps volunteer in the wonderful mountain village of Bonito Moncion, 
not very far from the Haitian border. I have a special affection for 
the Dominican Republic. The people of that small mountain village 
embraced me as one of their own. In fact, only a few weeks ago I 
traveled back to that mountain village of Moncion after a 24-year 
absence and spent a remarkable day with people I had known, who had 
such a wonderful impact on my life as a young Peace Corps volunteer.
  When I came to this body and went to the Congress in 1974, along with 
Paul Tsongas of Massachusetts, we were the first two former Peace Corps 
volunteers to be elected to the U.S. Congress.
  Paul Tsongas came to the Senate 2 years before I did. When I arrived 
here, we became the only Peace Corps volunteers to have served in this 
Senate. Today, I believe I am the only one to have had that privilege 
of being a volunteer in the Dominican Republic and to serve in this 
Senate. The countries of Central America I know well. I have traveled 
to all of them extensively over the years. I know the heads of states 
of each of these countries and have known virtually all of the heads of 
state over the last 24 years. It is with a great deal of personal 
interest, in addition to the subject matter interest, that draws me to 
this debate and to the Senate this afternoon. I have worked closely 
with many of these countries. As much as any Member of this Senate, I 
understand what a great boom a well-crafted agreement on trade can be 
to the people of Central America and for the Dominican Republic, as 
well as for we Americans.
  I don't expect CAFTA-DR agreement to be perfect. No trade agreement 
ever is. There are always matters either left unaddressed or under-
addressed when we have these agreements. The question should be whether 
trade agreements, on balance, serve to protect American interests and 
lift up the countries that we are negotiating with, or whether they 
will lead us all in the opposite direction.
  That is why I welcome the efforts of my colleague from New Mexico, 
Senator Bingaman, to strengthen the capacity of these nations of 
Central America and the Dominican Republic to effectively enforce and 
uphold internationally recognized labor rights. I believe the 
commitment by the administration to provide funds for the International 
Labor Organization, the ILO as it is called, in these CAFTA-DR 
countries is a step in the right direction. I commend my colleague from 
New Mexico, Senator Bingaman, for pursuing this provision. I commend 
Ambassador Portman for accepting the idea.
  But to strengthen the effectiveness of the International Labor 
Organization in carrying out its work in Central America, I believe 
there also needs to be a clear understanding, before we vote on the 
CAFTA-DR agreement, of the freedom activity that the International 
Labor Organization must have if its efforts are going to be effective. 
After all, the problem is not just about capacity building, as 
important as that is, which was the focus of the agreement with our 
colleague from New Mexico, it must also, out of necessity, be about 
enforcement of those rights.
  That is why I met yesterday, at some length, with Ambassador Portman 
and his staff and contacted the ambassadors of the five Central 
American countries and the Dominican Republic to describe what I 
believe is needed to make the International Labor Organization 
initiative of this agreement a meaningful one.
  As my colleagues know, over the years, I have generally been a 
supporter of free-trade agreements. If properly constructed, I believe 
trade agreements are in the best long-term interests of the United 
States. That is because, in today's highly interconnected world, we 
must keep up and adjust to the changes around us if we are going to 
compete effectively.
  This great surge toward a globalized world economy has brought gains 
and

[[Page 15077]]

losses here in our own country. Some industries have benefitted 
greatly; others have struggled to compete. On balance, I believe free 
trade has benefitted our country. But we have not done enough, 
especially during the past few years, to help ease the transition for 
those many Americans who are struggling.
  Globalization has affected other nations around the globe. From Latin 
America to India, Africa to China, no country has escaped the impact of 
this process. The difference is that while globalization has helped 
lift many nations, it has also left many others behind.
  In this hemisphere, the results have been mixed. Countries such as 
Brazil and Chile are doing quite well.
  Others have stagnated or, worse, even regressed. I put this in 
context for my colleagues when it comes to Central America and the 
Dominican Republic. When considering this debate and the conclusion of 
it, consider that one-third of the entire population of Latin America 
currently lives in poverty. In the nations south of the Rio Grande 
River, 128 million people survive on less than $2 a day; 50 million on 
less than $1 a day. That is more than a third of the entire population 
of these nations. In Central America alone, three out of every five 
citizens live in conditions of poverty. Two out of every five are 
indigent or in conditions of extreme poverty.
  In Nicaragua, for instance, there is widespread malnutrition and 
unemployment rates are way over 40 percent. Nicaragua is the second 
poorest nation in this hemisphere, with nearly half its population 
living on less than $1 a day.
  In Guatemala, the situation is also dire. Malnutrition rates are 
among the highest in the world. Life expectancy as well as infant and 
infant mortality rates are among the worst in this hemisphere. 
Illiteracy exceeds 30 percent and most people have less than 5 years of 
a formal education.
  But there is not only tremendous poverty in these nations, income and 
equality in Latin America is also one of the highest in the world. 
Consider that the richest 10 percent of all Latin Americans earn 
roughly 50 percent of the total national income in these nations; 
whereas the bottom 10 percent earn only 1.6 percent of income.
  Despite economic growth throughout the 1990s, unemployment in Latin 
America has actually increased. The Central American region has 
suffered greatly as a result of natural disasters. Hardly a year goes 
by that some natural tragedy does not occur in these nations. My 
colleagues will recall the mud slides in Haiti which last year cost 
thousands of people their lives and homes. There are repeated 
hurricanes that have hit Central America over the last decade and a 
half.
  In early 1993, after one of those hurricanes hit Nicaragua, I went 
down to work with the people of those nations to clear mud out of 
schools and impoverished communities. Bridges were wiped out, crops 
were lost, the country was devastated.
  In 1998, Hurricane Mitch, a category 5 storm, hit Honduras, 
Nicaragua, Guatemala, and El Salvador, killing 9,000 people and leaving 
more than 700,000 people in those four countries homeless.
  We are also talking about nations, many of which were almost ripped 
apart by brutal civil wars and political violence. Guatemala's troubled 
history dates back to 1954, when a military coup overthrew Guatemala's 
popularly elected president, Jacobo Arbenz Guzman, triggering a bloody 
civil conflict that lasted more than 30 years. Guatemala's conflict was 
largely a struggle for land rights and resulted in the murder or 
disappearance of more than 200,000 people, many of them indigenous 
Mayans living in the highlands of Guatemala. Fortunately, this armed 
conflict ended in 1996, with the signing of the peace accords between 
the Guatemalan Government and the armed opposition, grouped together as 
the Guatemalan National Revolutionary Unit.
  In El Salvador, it was discontent over social inequalities, a poor 
economy and a repressive dictatorship that in 1980 finally ignited a 
civil war between a repressive military government and leftist guerilla 
groups who united under the Farabundo Marti National Liberation Front. 
During 12 years of that civil war, 75,000 Salvadorans, mostly 
civilians, were killed and thousands more fled to refugee camps in 
Honduras and many more made their way north to the United States as 
immigrants. The United States provided more than $5 billion in economic 
and military assistance to the Salvadoran Government over the course of 
that conflict. But it took the U.N. to broker a peace accord to end a 
conflict that military force failed to resolve.
  Nicaragua's story is almost somewhat similar. In 1979, the Sandinista 
National Liberation Front of Nicaragua overthrew the 40-year 
dictatorship of the Somoza family and took control. In 1981, the Reagan 
administration responded aggressively to regional concerns with respect 
to the leftist regime. The United States funded and organized the new 
paramilitary force which became known as the Contras. The Contra war, 
as it became known, lasted until 1988 and resulted in more than 25,000 
deaths in that country and 700,000 refugees and displaced people.
  Although Honduras faced no serious civil conflict of its own, it 
served as a staging ground for efforts of the United States to fight 
the insurgencies in Guatemala and El Salvador and to overthrow 
Nicaragua's Sandinista government.
  Honduras's geographically central location made it a convenient base 
of operations for the Contras and a center of training and supply for 
the Salvadoran and Guatemalan militaries.
  Even democratic Costa Rica felt the ripple effects of its neighbors' 
conflicts as displaced persons from other countries took up residence 
in that nation.
  Finally, the governments of Central America courageously decided to 
take matters into their own hands. In 1987, without any real assistance 
from the United States, the Presidents of Guatemala, El Salvador, 
Honduras, Nicaragua, and Costa Rica negotiated and signed an agreement 
to create conditions for peace in Central America, which became known 
as the Esquipulas Agreement. That agreement marked a turning point for 
the people of Central America and created real possibilities for peace, 
reconciliation, and prosperity for the people of that region.
  Since 1990, the countries of the region have made progress. The guns 
have been silenced. There has been political reconciliation. There have 
been domestic or democratic elections. But still the region struggles 
for many of the root causes that sparked the civil conflicts in the 
first place: poverty and inequality and injustice.
  Taken individually or as a whole, this poverty, inequality, 
suffering, and political instability have severe implications. First, 
they threaten the political stability of Latin America. And I am very 
worried not only about this region but also other nations in the 
hemisphere that are democratic governments but are very fragile 
democracies. And second, by extension, they also threaten the national 
interests of the United States, as political instability did in the 
1980s.
  To understand how this is possible, I would point to--and advise my 
colleagues, if they have the time, to read--a 2004 report by the United 
Nations Development Program.
  According to that report, progress in extending elective democracy 
across Latin America is threatened by ongoing social and economic 
turmoil. Most troubling, the report suggests that over 50 percent of 
the population of Latin America would be willing to sacrifice 
democratic government for real progress on economic and social fronts. 
That is a very frightening statistic. And it should make crystal clear 
the urgency of this situation.
  Two decades of democratic progress in our hemisphere are at risk. 
Certainly, strong trade relations remain a key to creating a healthy 
economy both here in the United States and throughout the region. But 
trade alone cannot address the myriad of challenges facing Latin 
America, where millions of citizens in this hemisphere

[[Page 15078]]

remain marginalized by economic insecurity and social dislocation. And, 
sadly, the attention and foreign aid dollars of the United States have 
been diverted to other parts of the world in recent years.
  That is why I welcome the Bush administration's decision to reengage 
with the region and to strengthen economic ties by negotiating a 
regional free-trade agreement. I believe that the right kind of trade 
agreements can help these countries get on the proper course to 
stronger and more just societies.
  The question is whether, on balance, the agreement before us is that 
right kind of agreement. I stress the term ``agreement'' because it 
reminds us that these documents are about much more than free trade.
  They are about the worker who could lose his or her job. They are 
about the average citizen trying to provide for their families. And 
they are about social cohesion and political stability.
  These agreements are also about the future of a nation's economy. 
They are about protecting our national security. And they are about 
ensuring that the next generation will inherit a stronger foundation on 
which to build their futures.
  Or at least they should be.
  We, in the Congress need to decide if these agreements live up to 
these standards. As I said earlier, I have been, throughout my years 
here, a strong supporter of free-trade agreements. The case we have 
before us--of course, CAFTA-DR, deals with the Dominican Republic, 
Guatemala, Nicaragua, Honduras, El Salvador and Costa Rica.
  A meaningful agreement with these countries could, in my view, 
benefit the United States and the nations involved alike. For the most 
part, they need help. Poverty, corruption, social dislocation, and 
instability are all too familiar to the citizens of many of these 
nations.
  But the CAFTA-Dominican Republic agreement has some weaknesses, ones 
we tried to address over the last several days.
  Mr. President, I understand the sense of urgency the administration 
feels in having this agreement be decided upon in the waning hours 
before the Fourth of July recess. I regret, unfortunately, that we have 
to rush at this. But I understand why. If you do not have these 
agreements up under these time constraints, then they may not pass at 
all. So I appreciate the politics of why it is up under this shortened 
time-frame or up against the wall of this recess.
  That said, I regret we did not have a few more days. If we did have 
some more time I believe we might have been able to make some very 
important improvements to weaknesses in the current agreement.
  The most fundamental of these weaknesses I discussed last evening and 
I talked about at great length with Ambassador Portman yesterday.
  I also sent him a letter addressing the specificity of them; and that 
is, namely, the issue of labor laws in the CAFTA-Dominican Republic 
countries.
  When I speak of labor laws, I am speaking about the kinds of laws 
that these countries have enacted and about the enforcement of these 
laws. I am also speaking about current trade packages in this 
hemisphere that have been a major step forward to guarantee 
improvements in quality of life, creating wealth in these countries 
which, obviously, benefits us, as we want trade with nations that have 
people who can afford the cost of our goods and services. Both of these 
issues are critical components, I might add, to protecting Americans 
and to ensuring real progress is made in these nations.
  I would turn here to the issue of labor laws. According to the CAFTA-
Dominican Republic agreement, signatory countries must simply enforce 
the labor laws of their own nations--whatever they may be--in order to 
be in compliance. Indeed, I would note that the Dominican Republic and 
all the Central American countries, except El Salvador, have ratified 
what the International Labor Organization refers to as its eight 
fundamental conventions on labor rights. El Salvador, I might add, has 
ratified six of the eight. And while El Salvador needs to be brought up 
to speed, other signatories' laws seem to be at least minimally 
sufficient to the task, in my view.
  Why then does the current arrangement, with respect to labor laws, 
weaken this agreement? Because of two things. First, it does not hold 
those countries to the same objective standards. In fact, the CAFTA-DR 
agreement would actually lower current standards. Second, it ignores 
the impact that a lack of objective standards could have on the region.
  Let me explain.
  Previous trade preference programs for the region--previous ones; 
this is not new ground; previous ones--provided that the President 
should at least take into account the extent to which the beneficiary 
countries provide internationally recognized workers' rights. This is 
not the case with the CAFTA-DR agreement.
  In addition, as currently written, the CAFTA-DR agreement would 
weaken standards that these countries have been living under through 
the Caribbean Basin Initiative and the Generalized System of 
Preferences, where these agreements are not required. So instead of 
asking them to do the same with the CAFTA-DR agreement--or more--we are 
actually asking them to do less. It is a step backwards.
  Under the current trade agreements in this region, trade benefits can 
be withdrawn if a country lowers its labor laws below international 
standards or simply fails to meet these standards. And they can be 
withdrawn if a government directly violates internationally accepted 
workers rights that might not be protected under their laws.
  Under the Caribbean Basin Initiative, and the GSP, the right to file 
a complaint for violations of these rights is extended beyond just 
governments and to civil societies. But again, with this agreement, we 
exclude all of that.
  Under this agreement, governments will only have to enforce whatever 
laws they have on their own books at any given time. They will not be 
held to any international standards. That means the ocean floor is the 
limit, with respect to how weak these laws can get.
  Moreover, the lack of an objective standard here is troubling because 
it could create a race-to-the-bottom mentality where investors and 
companies play governments, one against the other, seeking lower labor 
standards in a quest for increased profits. That type of situation, in 
my view, could wreak havoc on civil societies in these countries, and 
it could also cost American workers their jobs.
  A second facet of the labor rights question deals with the issue of 
enforcement.
  As I said earlier, for the most part, CAFTA-DR nations have laws on 
their books. But they face a lack of resources, as well as domestic 
political opposition from influential people, which prevent them from 
enforcing these laws.
  Again, this is not about pointing the finger or accusing these 
government leaders of malice toward their workers. I don't believe 
that. I don't believe that is the case here either. I believe they 
actually want to do the right thing. I know these leaders. I respect 
them. But our neighbors to the south are democratic countries. And as 
in all democracies, they have to deal with powerful opposition 
interests.
  The question remains, will CAFTA-DR help these nations overcome this 
opposition to enforcement? In my view, it doesn't go nearly far enough 
to do so. That is why I met with Ambassador Portman yesterday to see if 
we could strengthen the prospects for enforcement. Laws that can't be 
enforced might as well not be there.
  The administration seems to hold the view that support for expanded 
trade and economic growth is incompatible with advocating core labor 
standards in developing countries. But, in fact, experts in this area 
from the well-respected Institute for International Economics have 
concluded that ``core labor standards support sustainable and broadly 
shared political, social, and economic development.'' The operative 
word being ``shared.''
  Let me say clearly I believe this agreement is fixable. I wish it 
could have been fixed. Ambassador Portman

[[Page 15079]]

and I met. We exchanged letters. We worked hard yesterday to try and 
see if we couldn't strengthen this agreement with respect to 
enforcement. What we sought was the following, exactly what exists in 
the Cambodian Agreement that was negotiated by the Clinton 
administration and renewed by the Bush administration, to their credit. 
There we said that the International Labor Organization ought to be 
able to make site visits to actually go to plants and industries to see 
whether the labor standards were being upheld. Under CAFTA-DR, all they 
can do is go to the labor ministries and ask them whether the laws are 
being enforced. Obviously, in most of these countries the labor 
ministries are political appointees. They are not likely to be critical 
of their own government's efforts. By not having any standard which all 
countries must meet, each country will be able to set the floor. When 
they do so, of course, the competition to have a lower floor to attract 
more industry from outside the country lowers the living standards for 
the very people I have described who are living under some of the worst 
conditions anywhere in the world.
  I am deeply troubled by this. I so much wanted to be for this 
agreement. I care so much about this region and what happens to these 
people. I would like nothing more than to be standing here today urging 
my colleagues to be supportive of this. This is not a minor point. It 
goes right to the heart of what we try to do with trade agreements; 
that is, to reduce these barriers, expand markets for our businesses 
and industries, create opportunities for additional job creation, and 
also to create and generate wealth in these countries so that in the 
long term, we can produce high value products, high value services, 
that are affordable in these countries.
  So trade agreements have worked both ways--expanding economic 
opportunities for ourselves and creating wealth and opportunity in the 
countries with whom we trade. That is why I supported NAFTA and the 
Jordanian Free Trade Agreement and others. Indeed, I have supported far 
more of these agreements than I have opposed. But with CAFTA-DR, we are 
stepping backwards in a region of the world that needs a commitment to 
lift up the quality of life for its citizens.
  I am not suggesting we could do it solely through this agreement, but 
you can begin to make a difference in these people's lives by insisting 
that they have to meet some minimum standards.
  This is what we should be saying: We want to do business in your 
country. We want to accept your products. We want to trade with you. 
But the small price we ask is that you have some basic standards for 
the people who are going to do the jobs.
  When you eliminate that, then you invite the kind of problems we are 
going to see with these people.
  I am terribly disappointed today. I had hoped I would be able to 
support this agreement. I wanted to be a part of this effort. I respect 
immensely the President inviting us down and talking about this. I 
raised the issue with him. I also respect Rob Portman. He is a good 
man. Obviously, he has the difficulty of dealing with all 535 of us, in 
both this Chamber and the other, to try and get the votes to pass these 
agreements. This agreement is probably going to be passed tonight. My 
hope was that we would be able to broaden the specter along bipartisan 
support for this agreement both here and in the other Chamber. 
Unfortunately, I don't believe that will be the case.
  Let me say to my colleagues: Even with the adoption of this agreement 
and the absence of these labor standards I feel so strongly about, it 
is my intention, through appropriate vehicles, to condition aid and 
other assistance on improving these standards in these countries. I 
will find one way or the other to try and improve them, to insist that 
these countries, in exchange for getting the kind of access to our 
markets, at the very least they ought to be required to improve the 
quality of life and the standards under which many of these people 
work.
  We stand today at a moment of great opportunity and great risk for 
this hemisphere. The past two decades have witnessed the rise of 
democratic governments in nations that have long languished under 
dictatorship of left or right. But this progress is endangered. 
Globalization and free trade promise to bring historic levels of 
prosperity to nations north and south. But economic and social 
conditions for millions of men and women continue to lag dangerously 
far behind, threatening what we have worked so hard to build. Through 
well-crafted trade agreements, the United States can enhance its own 
prosperity and lift other nations on a stable and democratic path.
  That is why I am so disappointed the administration wasn't able to 
explicitly support the efforts to give the ILO a greater role in the 
monitoring and verification process. I believe that in doing so, we 
would have significantly strengthened this agreement, especially given 
the troubled history of the region and the potential for mutual 
prosperity that a CAFTA-DR agreement held for all. Unfortunately, the 
agreement before us won't do that.
  Last night I sent Ambassador Portman a letter detailing proposals 
that have already been adopted in other agreements. This is not 
breaking new ground. I appreciate Ambassador Portman's response today 
in the letter he wrote back to me, but I regret that his letter 
included no real concrete commitment that the U.S. Government would 
guarantee the implementation that I am requesting--specifically, that 
the ILO would be granted unfettered access to workplaces, permitted to 
establish mechanisms for receiving and investigating matters related to 
ILO labor standards, to make private recommendations to worker and 
employer organizations and appropriate officials within each 
government, and to issue periodic public reports of its findings on 
matters of concern.
  Therefore, I am left to conclude that instead of breaking new ground 
and raising standards, the CAFTA-DR agreement is a step backwards from 
existing law. That fact saddens me deeply. This agreement will create a 
weaker set of standards that could very well negatively impact the 
people of this region, negatively impact American workers and our 
national security, and weaken democracy in these countries.
  Regrettably, I won't be able to support this agreement when it comes 
to a vote. I say this with a very heavy heart.
  But I will make a promise to the American people and to the people of 
these countries that I will work vigorously to ensure as we move 
forward with this agreement, workers' rights are protected and new 
avenues are explored for pursuing this goal. I hope at the end of the 
day, with all of the interests in this agreement, that our keeping the 
light shining on labor rights issues will make this agreement work. 
Because even though I can't support this agreement in its current form, 
I truly want to it work for all.
  I yield the floor.
  The PRESIDING OFFICER. Under the previous order, the Senator from 
Florida will be recognized for 10 minutes.
  Mr. MARTINEZ. Mr. President, I rise today to speak in support of this 
CAFTA Free Trade Agreement. Like the distinguished Senator from 
Connecticut, I care greatly about this part of the world. This is a 
part of the world I know well, having been born in the Caribbean 
myself. I do believe it is an important moment, and it is an important 
agreement from a geopolitical sense for the United States and for 
Central America. I believe this is a good-faith effort on our part to 
further strengthen the struggling democracies and economies of our 
neighbors in Central America against the forces opposed to democracy 
and economic freedom and opportunity. I believe this also opens an 
important neighboring market of 40 million people and levels the 
playing field for American businesses as we seek to export our goods 
into this region.
  Although I do think it is important to recognize this agreement will 
not come close to solving all of the problems in Central America, it 
should be a building block in addressing the great

[[Page 15080]]

needs of this important part of our hemisphere. I believe DR-CAFTA is 
an important moment. I believe its adoption does not fix all that needs 
to be done. I think its rejection would be a tremendously bad signal to 
this region. It would be a tremendous blow to our furtherance of 
democracy and stability and economic prosperity for Central America. It 
is a very important step in improving labor conditions, boosting 
economic growth throughout the Central American region.
  CAFTA is a critically important trade agreement for the State of 
Florida. We are the gateway to Latin America, to Central America 
particularly. Countries in Central America and the Dominican Republic 
form the largest foreign market for Florida exports.
  In 2004, Florida exported $3.2 billion of merchandise to the region, 
far surpassing that of the other 49 States. CAFTA is Florida's largest 
export market for paper, electronic equipment, and fabric.
  The CAFTA region is Florida's second largest export market for 
computers and computer equipment, machinery, and processed foods. Most 
of DR-CAFTA agricultural goods already enter the United States duty 
free. This will now even the playing field for our exports into the 
region.
  The CAFTA treaty is supported by the Florida Chamber of Commerce, 
Greater Miami Chamber of Commerce, the Orlando Regional Chamber of 
Commerce, the Greater Tampa Chamber of Commerce, Governor Jeb Bush, 
Florida Citrus Mutual, Seaboard Marine, Associated Industries of 
Florida, the Florida Ports Council, the Florida Poultry Federation, the 
World Trade Center of Florida, Florida East Coast Industries, and many 
others.
  No other State stands to benefit more economically from CAFTA than 
Florida.
  Mr. President, I have been undecided in my position on CAFTA, as much 
as I support free trade and understand the power of leveling trade 
barriers, an important sector of Florida's agricultural industry was 
left unprotected by the original CAFTA agreement.
  The sugar industry in Florida is an incredibly important part of our 
State. It provides over 23,000 jobs, mostly in rural Florida. Over $2 
billion in economic activity is generated in Florida from the 
production of corn and sugar sweetener products. And because of this 
critically important economic engine for our State, I have resisted 
supporting CAFTA because of the potential impact on Florida's sugar 
producers.
  So I and other colleagues began working to see what type of 
compromise might be reached for Florida's sugar producers so that they 
would be treated fairly in the event of a CAFTA agreement.
  After many meetings, phone calls, conference calls, and hard work by 
Secretary of Agriculture Johanns, Ambassador Portman, my good friend, 
the distinguished chairman of the Agriculture Committee, Senator Cham-
bliss, along with a group of colleagues that Senator Chambliss pulled 
together, an agreement has been offered that I believe extends and 
offers an opportunity to deal with the sugar problem.
  I thank our Trade Representative, Rob Portman, for his hard work in 
trying to address the concerns of this important part of our 
agricultural industry. I am also very thankful for the leadership of my 
colleague, Senator Chambliss, chairman of the Senate Agriculture 
Committee. Secretary Johanns, from the Department of Agriculture, was 
also instrumental in ensuring that we could come to a proposal on how 
we could best ensure that our domestic sugar producers were treated 
fairly after a CAFTA agreement. I thank them all for their work on this 
important issue to our State.
  My goal was to ensure that the Florida sugar industry was treated 
fairly, be given a viable role in the future, and that they did not 
become the one industry in Florida, the one segment of our agricultural 
industry that would be harmed by a CAFTA agreement. But I do believe 
that this proposal offered by Secretary Johanns and the administration 
is the best case scenario for Florida's sugar producers.
  The Secretary's offer is multifaceted. One, foreign sugar from all 
foreign countries cannot exceed the farm bill's 1.532-million-ton 
limit, regardless if it came from CAFTA countries, Mexico--which is 
under NAFTA and not subject to the farm bill--and other future trade 
agreements. This agreement will last until the current farm bill 
expires.
  Two, USDA will conduct a feasibility study on the potential 
development of using sugar to produce ethanol on a wide scale in the 
United States.
  Thirdly, if the domestic market reaches the sugar trigger from 
foreign sugar, USDA will purchase the excess amount of CAFTA sugar that 
is imported to the United States and then use it to produce ethanol. 
This pilot program will last until the farm bill expires. It 
essentially guarantees that if CAFTA sugar is proven to depress the 
marketplace, the U.S. Government will purchase this sugar from Florida 
farmers and others to produce ethanol.
  This is a very substantial offer. It is an agreement that I think 
represents the sugar industry's best chance to plan for a future. It 
holds the industry harmless from CAFTA and, more than that, from NAFTA. 
The future of the domestic sugar industry lies in new technology and 
ethanol production, and this treaty allows them to begin that very 
important process.
  Mr. President, this is an important moment for us and Central America 
and the Dominican Republic. It represents a future partnership in trade 
and economic development, a better future, a better life, and will 
hopefully help improve economic conditions and provide political 
stability.
  We have a chance to help our Nation's manufacturers, businesses, 
farmers, and ranchers knock down trade barriers and help our country 
remain competitive in a global marketplace.
  In summary, I have said consistently that before I voted for CAFTA, I 
wanted to ensure that all of Florida's agricultural sectors were 
treated fairly under this agreement, including the sugar producers.
  I have worked hard to find a compromise that would offer protections 
to Florida's sugar producers from the threat of a flooded domestic 
sugar market.
  I believe the proposals put forth by Secretary Johanns and the 
administration to hold imports of sugar to levels included in the 2002 
farm bill is the best case scenario for Florida's sugar producers and 
ensures that they are treated fairly not only under CAFTA but NAFTA as 
well.
  The sugar industry is incredibly important to our State, to our 
economy, and a vital part of our agricultural sector. The industry 
provides, as I said, over 23,000 jobs. Therefore, this is an industry 
that we want to make sure was not overlooked as we went about seeking 
this agreement.
  Having obtained what I thought was a fair and reasonable offer, I 
believe now I can wholeheartedly support the CAFTA agreement. I believe 
it will be good not only for the United States and the State of 
Florida, but also for our neighbors in Central America and the 
Dominican Republic. I think it will provide a new opportunity and 
beginning and a new hope for this region to begin on a much stronger 
road to economic development, to economic self-sufficiency, and, 
hopefully, tied into that is political stability, democracy, the rule 
of law, and the free market system.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time?
  Mr. DORGAN. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. Mr. President, I yield 10 minutes to the Senator from 
Florida, and following the remarks of the Senator from Florida, I ask 
unanimous consent that 10 minutes then be allocated to Senator Sessions 
and that the time be taken out of the time allocated to Senator 
Grassley.

[[Page 15081]]

  The PRESIDING OFFICER. Did the Senator yield 10 minutes to the 
Senator from Florida?
  Mr. BAUCUS. Yes, 10 and 10.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Florida.
  Mr. NELSON of Florida. Mr. President, I worked on this trade 
agreement pretty hard. Now that this agreement is in front of us, 
despite some lingering concerns I have, I will support it. This 
agreement affects my State of Florida more than any other State in the 
Union. For example, in 2004, the State of Florida exported $3.2 billion 
worth of merchandise to the DR-CAFTA region. Florida has the highest 
total among any State. The next nearest State, Texas, exported $1.8 
billion. And the DR-CAFTA region accounts for 11 percent of Florida's 
total exports.
  Florida does stand to gain a great deal from this agreement. Miami, 
which is really the capital of the Americas, is the national gateway to 
Central America and the Dominican Republic. Throughout the rest of 
Florida, we have other industries that will also increase their 
business and explore new opportunities in the region.
  These Florida industries stand to grow enormously. Because of our 
unique relationship, we have been talking about thousands of jobs 
created in the first year and tens of thousands of jobs in the coming 
years as a result of DR-CAFTA's enactment.
  I have been to the Dominican Republic. I have spoken with the 
President, Leonel Fernandez. I recently went to Honduras at the 
invitation of the President Maduro and spent a couple of days there and 
spoke at length with not only our U.S. embassy personnel but members of 
the Government of Honduras.
  I believe that dramatically lower tariff barriers also will lead to 
increased exports to the region from Florida and through Florida's 
ports. This increase in business and industry for my State is a good 
deal and will increase our connections with these countries and all of 
Latin America.
  This agreement is also, I believe, in our national interest. Free and 
fair trade creates new economic opportunities for Americans, and it 
creates economic uplift in these other countries. This economic uplift 
is critical to ensuring that these countries remain stable and people 
are not forced to emigrate in search of employment.
  As we try to stabilize countries in the region, promote democracy, 
clearly their economic enhancement is in the interest of the United 
States, in order to see those struggling democracies flourish. And that 
is the clear message I heard as I traveled extensively throughout Latin 
America.
  Unfortunately, as we know, free-trade agreements do not affect all 
industries equally, and Florida has vulnerable industries that we must 
protect from unfair trade practices. My colleagues have heard me speak 
many times about the Florida citrus industry and the threat that it 
faces from Brazil. Today, I raise my concerns about another important 
Florida industry, and that is the sugar industry.
  DR-CAFTA, as negotiated, asks our sugar industry to sacrifice more 
than other commodities. American sugar producers face an international 
market where sugar is sold at artificially low prices because of unfair 
labor practices and habitual dumping.
  In the last FTA, the Australia agreement, interestingly, sugar was 
excluded, but the administration changed course on CAFTA negotiating 
extra sugar access and, at the same time, establishing a new precedent.
  I worked with numerous Senators, especially over the last 3 weeks. I 
have raised sand with the administration about these provisions. I have 
let them know that there was more that could be done to protect the 
American sugar industry. In response, the administration has made some 
commitments that I believe will help mitigate the impact on our 
domestic sugar producers through the life of the 2002 farm bill, which 
will go for another 2 or 3 years.
  Sugar levels available on the U.S. market will not go above the level 
established in the farm bill. Ambassador Portman, the U.S. Trade 
Representative, and I had a personal eyeball-to-eyeball meeting this 
afternoon. He made it clear to me that there is no prospect of any 
substantial sugar concessions being included in any other trade 
agreements through the life of the farm bill. This was an individual 
conversation, and he is not going to take that position officially 
because he does not want to tie his hands, but that is the bottom line 
of our conversation.
  The administration has also committed to study the feasibility of 
converting sugar into ethanol. At my urging, the Deputy Secretary of 
Agriculture--and this was arranged by Ambassador Portman who directly 
gave me his word--said: Do you want it in writing? I said: I accept 
your word, that is good enough for me, but others may like to see it 
memorialized. He said: I will get you a letter.
  I have this letter, and I ask unanimous consent that the letter be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                              The Deputy Secretary


                                               of Agriculture,

                                    Washington, DC, June 30, 2005.
     Hon. Bill Nelson,
     U.S. Senator, Hart Building,
     Washington, DC.
       Dear Senator Nelson: I write to provide further guidance on 
     the feasibility study outlined in Secretary Johanns' June 29, 
     2005 letter to Senator Chambliss (attached), which was the 
     result of discussions between the Senator, the Administration 
     and the Members of Congress that the Senator brought 
     together.
       They agreed that the Secretary would conduct a feasibility 
     study on converting sugar into ethanol and submitting the 
     results of the study to Congress not later than July 1, 2006. 
     The Department of Agriculture will begin the feasibility 
     study immediately and I intend to have an initial meeting 
     with our economists during the week of July 4. Furthermore, 
     it would be USDA's intention to issue an interim report by 
     December 15, 2005.
       I hope this additional clarification is helpful to you.
           Sincerely,
                                                Charles F. Conner,
                                                 Deputy Secretary.

  Mr. NELSON of Florida. Mr. President, this letter is from the Deputy 
Secretary of Agriculture, who has promised to commence a feasibility 
study on converting sugar into ethanol and to start it immediately, 
with an initial meeting of the agricultural economists next week, the 
July Fourth week. I believe at that point they will and should lay out 
a baseline of the knowledge we have on this issue.
  I expect that will occur, and I expect that quite a lot of research 
on converting sugar into ethanol has already been carried out and that 
this study should acknowledge this research and build upon it. In other 
words, don't start the feasibility study from scratch.
  The Deputy Secretary has also promised me that the Department of 
Agriculture will issue an interim report in addition to what they had 
earlier promised, a report that would be concluded by July of next 
year, 2006. In this letter, the Deputy Secretary says they will issue 
an interim report by December 15, 2005.
  The feasibility study is a start, but we can do much more. In every 
other ethanol program around the world, sugar is included. I urge the 
conferees on the Energy bill and the administration to make sugar a 
part of the ethanol program established in that bill.
  I ask unanimous consent that my letter to the conferees be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                  U.S. Senate,

                                    Washington, DC, June 30, 2005.
     Hon. Pete V. Domenici,
     Chairman, Senate Energy and Natural Resources, U.S. Senate, 
         Washington, DC.
     Hon. Joe Barton,
     Chairman, House Energy and Commerce, House of 
         Representatives, Washington, DC.
     Hon. Jeff Bingaman,
     Ranking Member, Senate Energy and Natural Resources, U.S. 
         Senate, Washington, DC.
     Hon. John D. Dingell,
     Ranking Member, House Energy and Commerce, House of 
         Representatives, Washington, DC.
       Dear Sirs: I support the inclusion of provisions in the 
     House and Senate energy bills to increase the renewable 
     content of our motor vehicle fuel. Renewables such as ethanol 
     burn cleaner, reduce tailpipe emissions and decrease the 
     amount of oil in our gasoline.

[[Page 15082]]

     But, I urge the Energy Bill Conference Committee to require 
     that 100 million gallons of the five to eight billion gallon-
     a-year ethanol mandate be sugar-based.
       As you know, sugar cane stalks, or bagasse, produce almost 
     twice as much ethanol per acre as corn and several countries 
     use sugar-based ethanol to fuel their motor vehicles. In 
     fact, Brazil reduced their importation of oil from 80% of 
     their demand in the 1970s to 11% today in part by using 
     ethanol, much of it sugar-based. For these reasons, 
     specifying that a 100 million gallons of sugar-based ethanol 
     be required as part of the overall ethanol motor vehicle 
     fuels program would be an important step towards decreasing 
     our use of fossil fuels and increasing our use of renewable 
     fuels.
       Thank you for your consideration.
           Sincerely,
                                                      Bill Nelson.

  Mr. NELSON of Florida. Expansion of alternative fuel programs is an 
urgent national priority. If we are concerned about importing 60 
percent of our daily oil consumption from foreign lands, we best 
develop a substitute, and ethanol works in our existing gasoline 
engines.
  In conclusion, frankly I believe the administration could have done 
better. They could have started discussions with the industry sooner by 
allowing all parties to explore the available options. I believe more 
time could have led to further agreements and compromise, but I must 
look not to the interests of one very important industry in my State 
but also to the greater interests of Florida and especially the Nation 
as a whole.
  I will vote for CAFTA today. It is important to my State and it is 
important to the Nation.
  The PRESIDING OFFICER. The Senator's time has expired.
  Who yields time?
  The Senator from North Dakota.
  Mr. DORGAN. Mr. President, I have great respect for all of my 
colleagues no matter what they decide to do on this vote. I think the 
vote is probably predetermined this evening. I must say there are a lot 
of promises I have heard on the floor the last day or so. There have 
been a lot of promises made downtown. I would only point out that I 
have seen the result of most of these promises after the votes are 
taken and most of them have not been worth the paper they are written 
on or the assurances given have not been valuable at all.
  One might want to look at the side agreement dealing with sugar from 
Mexico; one can then go on to a sweetener agreement with Mexico; then 
can go on to a lot of these areas and understand that there are a lot 
of promises in order to get these bills passed, but by and large they 
do not amount to very much. They will not need anybody in this Senate 
after the ``yes'' votes are cast.
  I start at the beginning, if I might. I know we are nearing the end 
of this debate. I do not want to go all the way back to the beginning, 
but let me go back a fair piece. It is when John Adams is in Europe as 
they are putting this new country together. He is in Europe 
representing our country. He writes back to his wife Abigail and asks 
Abigail the question: Where is the leadership going to come from? Where 
will the leadership emerge to help form this great country of ours, to 
help form a new government?
  He plaintively kept asking, where will the leadership come from? Then 
in subsequent letters he would say to her, there is really only us. 
There is me. There is Thomas Jefferson, Ben Franklin, George 
Washington, Madison, Mason. Of course, in the rearview mirror of 
history, the only ``us'' represents some of the greatest human talent 
ever assembled. They wrote a document that is the most remarkable 
document. It is a document called the U.S. Constitution that begins 
with ``we the people.'' That Constitution that begins with ``we the 
people'' provides mechanisms, the framework of our Government, the 
framework of a representative democracy.
  Over many years, with that document providing the fabric of the 
growth of this great country, we have been a country that has been 
divinely blessed in many ways. We have built a place unlike any other 
place on the face of this Earth. There is no place like it. One can 
spin the globe and on this little planet called Earth, with 6 billion 
neighbors, there is no place quite like the United States of America.
  We created an expanded set of opportunities for all Americans, 
through a lot of good decisions; for example, universal education. We 
as a country decided long ago every young child ought to be whatever 
their God-given talents allow them to be. We are not going to separate 
kids in our school system. They get to go to school and they get to 
become whatever their talents allow that child to become.
  That universal education for all Americans has created a country that 
is unlike any other in the world. We went from the Colonies to the 
States. We survived a Civil War. We beat back a Depression. We resisted 
the oppression of Adolf Hitler, won a Second World War. We provided a 
GI bill, and when those soldiers came back from that war, they went to 
college. They got their college degrees. They came back to their 
communities. They built a home, got married, raised a family, built 
schools, built communities. What a remarkable country this has been.
  It all comes back to this book, this Constitution. Other countries 
have constitutions, but none are quite like this Constitution. This 
Constitution says something about international trade and commerce. It 
describes the regulation of commerce and trade to the Congress. It is 
our responsibility, not the President's responsibility.
  So over a number of years we have worked on and dealt with these 
issues and then we have had in many ways an almost breathtaking series 
of decades. We have split the atom, we have spliced genes, we have 
cloned animals, we invented plastics, nylon, the radar, the silicon 
chip. We cured polio, smallpox. We built airplanes, learned to fly 
them. We built rockets, flew to the Moon and walked on the Moon. We 
created telephones, television sets, computers. What a remarkable set 
of achievements for the men and women in this country who are the 
doers, the achievers, the inventors. We stand on each other's shoulders 
looking to the future.
  So about three decades ago things began to change. This world became 
smaller. We started hearing about the global economy. We began to do 
more and travel more and have more connections with other parts of the 
world, and particularly large corporations which were developed because 
of economies of scale. Those large corporations began to be able to do 
business in more than one country. Then they defined for their own 
interests the opportunities by which they would do that business. It 
then became a global economy. In that global economy, we began to hear 
the term free trade, free trade, like a chant, almost like the hare 
krishna chanting on a street corner, wearing robes: Free trade.
  Well, free trade is of little interest to me. I am very interested in 
expanded trade and fair trade, but free trade, there are a lot of 
things that are free.
  This country built a place unlike any other on the face of this Earth 
and we need to be concerned about its continuation. So the question is 
what kind of trade gives us the opportunity to continue improving the 
standard of living in America, creating an economy that produces new 
jobs and new opportunities?
  I am sure every single set of parents in this country wants things 
better for their kids. If there is something in second place, beyond 
the importance of their children, I guess I understand that, but 
everybody would believe, I expect, that what is most important in their 
lives is their children. We care about these things that affect our 
children. Are we sending our kids to good schools? Are we proud of 
these schools? Do we believe we are able to leave a world that is a 
better place in which to live than the one we found? Is that what we 
are going to do for our kids?
  So as we confront this question of the new global economy and a new 
global strategy, the galloping globali-
zation of our economy, without a set of rules that has kept pace, the 
question for all of us is: What does it mean for our country? What does 
it mean for our future? What does it mean for our kids--especially our 
kids?
  In the past decade, we have seen a very substantial loss of American 
jobs.

[[Page 15083]]

Some people say, do not worry, be happy, ignore it. It is all part of 
the transition. What we will see is our low-skilled jobs move 
elsewhere, we will educate our children, and we will assume the role of 
high-skill, high-paying jobs; don't worry.
  So we pass trade laws. They are called CAFTA and NAFTA and GATT, WTO. 
We do all of these things. Then somehow, at the end of this process, we 
look back and we see, you know, something fundamentally has changed. 
Somebody has pulled the rug out from under what are the basic strengths 
of this country--a good job that pays well, that provides benefits, 
that you can count on.
  About 30 years ago the biggest corporation in America was General 
Motors. In most cases, people who went to work for General Motors 
expected to work there for a lifetime. They were paid well and they had 
benefits, health care and retirement. That was 30 years ago.
  Now the largest corporation is Wal-Mart. They do not pay so well. 
Most people do not spend a lifetime at Wal-Mart. The average wage is 
much lower, and a fairly substantial number of their employees do not 
have benefits.
  That is a very substantial change, really a dramatic change in our 
country. But the biggest change has been the development of a set of 
ideas by those who are able to influence thought in this country, 
particularly the largest corporations that have unlimited quantities of 
money, who convinced us that free trade, as a moniker, is a mechanism 
for success in our country.
  So we pass trade agreements, the end of which means we lose American 
jobs, lose economic strength, and somehow believe that somewhere in the 
future things are going to get better.
  I want to show a chart I have shown many times during this debate. It 
is a chart that shows what has happened with our trade deficit. This is 
a dangerous trend. Behind these red lines are lost jobs, families who 
lost their jobs, hundreds of them, thousands of them, and millions of 
them. Not many people in here know those people. No one in this Chamber 
lost his or her job because we all put a suit and necktie on and come 
to work. Nobody is going to get outsourced or offshored in the Senate. 
But all these folks did.
  I have lists of companies and lists of names of people who just lost 
their job because of this new approach, a new defined approach in 
international trade that says in our country, we will be the leader 
that says go ahead and find, with the mechanism of production, the 
lowest cost production in the world. Get your Gulfstream, circle the 
globe and find out where you can produce for 30 cents an hour. Move 
that job to that area and, by the way, when you do, we will give you a 
tax cut. Let me say that again, because that is kind of a Byzantine 
proposition. When you close your American factory and fire your 
American workers, you get a tax cut from our Government. And, yes, I 
have tried twice to change that in the Senate and, yes, a majority of 
the Senate voted to keep a tax cut for workers who get fired and 
companies that move those jobs overseas. I will put in the 
Congressional Record their names. I really don't need to. A very easy 
Nexis-Lexis search will give you the names of who decided they should 
keep their tax cuts for companies that move their jobs overseas.
  The point is, we are seeing this inevitable, relentless move to 
produce where it is cheap and then sell into the established 
marketplace. The problem is, this is unsustainable. This is a theory 
that is off track and it is a practice that injures this country.
  Why do I say the theory is off track? Henry Ford decided, when he was 
going to make Fords, that he wanted to pay his production workers 
sufficient money so that they could buy the cars they were producing. 
That is pretty simple. That is simple economics. If you are paying your 
workers enough money so they can buy the products they are producing, 
you have a market and a consumer for the product. A pretty smart guy, 
Henry Ford.
  Now it has changed. Now we should produce those shirts and those 
shoes and those trousers and all the trinkets where you can do it for 
30 cents an hour and then ship it to Fargo and Toledo and Dayton and 
Los Angeles and New York and sell it there.
  The question is, Who ultimately is going to buy that? Who ultimately 
will buy this?
  We have a lot of dislocations that are dangerous. I have not talked 
at all about this, and I will not talk at length. A part of this, by 
the way, is oil. A part of this is oil. There are some on this globe 
who are lucky enough to have enough oil under the sands so if you stand 
in a depression in the sand with boots, your soles are going to look 
oily because some parts of this world are loaded with oil, particularly 
the Middle East. So the Saudis, Kuwaitis, Iraqis, and others have a lot 
of oil. We are desperately and hopelessly addicted to it. Our economy 
is addicted to it, and that is part of this. It also relates to jobs 
because, when you have the purchase of oil from these countries--Saudi 
Arabia and Kuwait and so on--they end up with American dollars, which 
means they want to buy American companies. They want to buy American 
stock. It is a way of buying part of our country.
  In today's newspaper it says, ``China Tells U.S. Not To Meddle in the 
Bid for California Oil Giant.''
  The story is the Chinese want to buy the ninth largest oil and gas 
company in the United States called Unocal.
  Why would they want to buy Unocal? They are like everybody else. They 
want to control oil to the extent they can. The Chinese, I am told, now 
have 20 million cars. They have 1.3 billion people. By 15 years from 
now they are expected to have 120 million automobiles. They are going 
to need gas. They are going to need a lot of gas. The price of oil is 
not going to go down, it is going to go up. They want to buy an oil 
company. I don't think this should happen in a million years, by the 
way. I don't think we should have the Chinese buying American oil 
companies, but I will tell you why this is happening. It is happening 
because these trade deficits are putting massive amounts of money in 
the hands of Chinese, and it gives them the opportunity to purchase, on 
the open market, America's stocks, bonds, companies.
  I mentioned previously that Warren Buffett, whom I like a lot--I 
think he is the second richest man in the world, but you would never 
know it. Warren is just a great guy. Warren Buffett described this 
problem as ``a country that is now aspiring to an ownership society 
will not find happiness in a sharecropper society.''
  This is where we are heading, he says, a sharecropper society. He 
describes this is when every day, 7 days a week, you put $2 billion in 
the hands of foreigners. You are buying $2 billion more from foreigners 
than you are selling to them every day, 7 days a week. You are putting 
$2 billion more into hands of foreigners and foreign governments. That 
means each day they have more purchasing power to buy another part of 
America. That is where this comes from. The Chinese want to by Unocal. 
That is where the money comes from, the $140 billion trade deficit with 
China last year. That means they have our country's currency. They have 
the capability of buying our stocks and our companies.
  The question is, Do we care about that? Does anybody here want to 
change the strategy or do you want to do some more of it?
  The attitude in the Senate, as I think we will discover when the vote 
is taken tonight is that if you are digging yourself into a hole, what 
you need is more shovels and just dig a little harder. That makes no 
sense to me.
  If there is one person in the U.S. Congress who does not understand 
the danger of this, then they are in the wrong business. This is 
trouble. This comes from CAFTA, it comes from GATT, it comes from 
incompetent trade negotiators and bad trade deal after bad trade deal. 
I just heard on the floor of the Senate today, I will bet you six 
people who talked about promises that have been made to them in order 
to get this trade deal through the Congress. These promises mean 
nothing. These are totally, completely empty promises.

[[Page 15084]]

  Let me briefly describe this. I am going to use Warren Buffett to 
describe it because, again, I like Warren Buffett. He described it this 
way. Stay with me just for a moment.

       To understand why, take a wildly fanciful trip with me to 
     two isolated, side-by-side islands of equal size, 
     Squanderville and Thriftville. Land is the only capital asset 
     on these islands, and their communities are primitive, 
     needing only food and producing only food. Working eight 
     hours a day, in fact, each inhabitant can produce enough food 
     to sustain himself or herself. And for a long time that's how 
     things go along. On each island everybody works the 
     prescribed eight hours a day, which means that each society 
     is self-sufficient.
       Eventually, though, the industrious citizens of Thriftville 
     decide to do some serious saving and investing, and they 
     start to work 16 hours a day. In this mode they continue to 
     live off the food they produce in eight hours of work but 
     begin exporting an equal amount to their one and only trading 
     outlet, Squanderville.
       The citizens of Squanderville are ecstatic about this turn 
     of events, since they can now live their lives free from toil 
     but eat as well as ever. Oh, yes, there's a quid pro quo--but 
     to the Squanders, it seems harmless: All that the Thrifts 
     want in exchange for their food is Squanderbonds (which are 
     denominated, naturally, in Squanderbucks).
       Over time Thriftville accumulates an enormous amount of 
     these bonds, which at their core represent claim checks on 
     the future output of Squanderville. A few pundits in 
     Squanderville smell trouble coming. They foresee that for the 
     Squanders both to eat and to pay off--or simply service--the 
     debt they're piling up will eventually require them to work 
     more than eight hours a day. But the residents of 
     Squanderville are in no mood to listen to such doomsaying.
       Meanwhile, the citizens of Thriftville begin to get 
     nervous. Just how good, they ask, are the IOUs of a shiftless 
     island? So the Thrifts change strategy: Though they continue 
     to hold some bonds, they sell most of them to Squanderville 
     residents for Squanderbucks and use the proceeds to buy 
     Squanderville land. And eventually the Thrifts own all of 
     Squanderville.
       At that point, the Squanders are forced to deal with an 
     ugly equation: They must now not only return to working eight 
     hours a day in order to eat--they have nothing left to 
     trade--but must also work additional hours to service their 
     debt and pay Thriftville rent on the land so imprudently 
     sold. In effect, Squanderville has been colonized by purchase 
     rather than conquest.

  That is my friend Warren Buffett's description of what is happening. 
And it is why, by the way, the Chinese have the money to buy Unocal. 
This is about Squanderville and Thriftville. The question he asks: Is 
anybody listening? Regrettably, the answer in the Senate is: Precious 
few.
  I have spoken at great length about companies. I have not spoken 
previously about Pennsylvania House, which I will do just for a moment. 
I have talked about Huffy bicycles, Radio Flyer little red wagons, Fig 
Newton cookies--which, by the way, went to Monterrey, Mexico, so if you 
want some Mexican food, order Fig Newton cookies.
  Let me tell you about Pennsylvania House Furniture, high-end 
furniture made with Pennsylvania wood, hardwood and cherry wood, high-
end, terrific furniture, made for many decades in Pennsylvania and 
marketed as Pennsylvania Furniture.
  Pennsylvania House Furniture was purchased by Lazy Boy Corporation 
about 4 years ago. Lazy Boy decided it is just too expensive to 
manufacture Pennsylvania House furniture in Pennsylvania, so we have to 
move it to China. Now Pennsylvania House furniture will be made in 
China. They will ship the wood from Pennsylvania to China, the 
hardwood, the cherry wood. They will put it together in China and ship 
the furniture back.
  So it is for Robert Zechman. Robert Zechman worked for that company 
for 29 years. On December 21, four days from Christmas, he got his 
letter: You get $92-a-year severance for the service you have given 
this great company. Now we are shipping the wood and your job to China. 
They put the furniture together and ship it back. We will still call it 
Pennsylvania House Furniture, but the only Pennsylvania part of that 
furniture is the wood. The people are expendable.
  The question is, Does anybody care about that? Does it matter to 
anybody? It mattered to Pennsylvania. Governor Rendell said: We have 
500 people who work here. We would like to save these jobs. They put 
together an effort to save those jobs. Finally, we were told that Lazy 
Boy said: We are not interested in having competition domestically, so 
we are not going to sell. We are moving to China.
  Same story with Huffy bicycles. Same story with dozens and dozens and 
dozens of companies.
  I spoke last week about a refrigerator company that decided they will 
close their American plant, notify the workers: No jobs in this country 
for you anymore. Why? Because we are going to make those refrigerators 
in Mexico. And, by the way, just to rub salt in the wound, one part of 
the manufacturing plant with which they will manufacture those 
refrigerators in Mexico has an Ex-Im Bank loan. That is a loan 
subsidized by this Government to build a part of a plant in Mexico to 
house the jobs of the workers who were fired in this country to build 
some refrigerators.
  Does it matter? Maybe not to some. It matters to me. Does it matter 
whether we make refrigerators? Does it matter whether we make fine 
furniture? Does it matter whether we have a manufacturing base? Will 
America remain a strong world-class economy if it gives its 
manufacturing sector away?
  In the last 25 years, we have lost one-half of our manufacturing 
capacity. Is there anybody here who is having an apoplectic seizure 
about that? Not hardly. We snore our way through this. President after 
President gives us a new trade law to see if we can improve on this 
massive debt that keeps growing and growing and growing. In the 
meantime, Robert Zechman will probably ask his Congressman or his 
Senator: What is going on there? Are you standing up for America, 
standing up for jobs in this country? Absolutely, he will hear. You bet 
your life. We are all for American jobs. It is just that the trade 
agreements trade them away--quickly. The majority of the people in the 
House and the Senate are going to vote for these trade agreements.
  America Online--December 2003--had just laid off 450 American 
employees, mostly design engineers and software engineers, in its 
California offices. Then those same engineers read that America Online 
was trying to hire software development teams and engineers in 
Bangalore, India. Does that mean you change your name to India Online, 
or is it still America Online that divests itself of U.S. employees and 
hires the engineers in Bangalore?
  The list is endless. We come down, finally, to a choice, a choice 
this Senate will make once again on another trade agreement. The NAFTA 
trade agreement, called North American Free Trade Agreement, was 
negotiated between the United States, Mexico, and Canada. It was just 
one more chapter of bad trade agreements. But before that trade 
agreement, we had a slight surplus in trade with Mexico. We had a 
modest deficit with Canada. Now we have had about 10 years of trade 
agreements called NAFTA, and now we have a very large trade deficit 
with Mexico and a larger trade deficit with Canada. One would wonder if 
somebody would stand up and scratch their head and say: Gee, I wonder 
if we didn't make a mistake here.
  The economists, by the way, who most trumpeted the benefits of NAFTA, 
the North American Free Trade Agreement, were two economists named 
Hufbauer and Schott. I am sure they are still practicing economists. I 
see the names Hufbauer and Schott.
  I actually used to teach economics. Economics is just a little bit of 
psychology pumped up with a lot of helium. I taught it for a little 
while and was able to overcome that experience and still lead a 
productive life.
  But these economists, Hufbauer and Schott, said: If you just pass 
NAFTA, we will promise you a remarkable future. What will happen is 
jobs will transpose. We will see low-income, low-skilled jobs being 
performed by Mexicans and high-skill, high-wage jobs now producing a 
product to be sold into an emerging middle class in Mexico, and those 
will be produced in America.
  These people were totally, completely wrong about everything. Has 
anybody said, We were wrong? Of course not. In this debate on CAFTA,

[[Page 15085]]

which is another acronym--NAFTA, CAFTA, SHAFTA, whatever it is--on this 
debate, we are now hearing NAFTA was really good. Boy, if we could just 
get some more of this spoiled trade agreement, somehow things would be 
better off. They would not be better.
  Let me try to tell you what I believe our obligation is. Yes, I want 
a strong economy. Yes, I want American companies to understand we 
support their interest in competing around the world.
  But I believe that, first of all, in the boardrooms they ought to say 
the Pledge of Allegiance from time to time. If we charter American 
corporations as artificial people--and that is what a corporate charter 
is about. We say we are going to create you as an artificial person. We 
are going to give you a charter which gives you limited liability. You 
can sue and be sued, contract and be contracted with. You are, in fact, 
an artificial person. If that artificial person, by corporate charter, 
given by this country, is in America, then it ought to care just a bit 
about this country's interests. And, yes, maybe just a recitation of 
the Pledge of Allegiance, occasionally, in the boardroom might help.
  When we hear people say, ``We want all the benefits for our 
corporation being American, except the responsibility for paying taxes 
is something we want to shed,'' I worry about loyalty and commitment to 
this country. And, yes, that is happening. We see what is called 
inversions, where corporations want to renounce their American 
citizenship to become citizens of the Bahamas. Why? Because they want 
to become Bahamian citizens? No. Because they want to avoid paying U.S. 
taxes. I have always said, if they want to do that, if they run into 
trouble, let them call out the Bahamian Navy. My understanding is, 
there are about 24 people in the Bahamian Navy. Let them call on the 
Bahamian Navy.
  The point is, I think we ought to support American companies in 
competing around the world, but we ought to expect certain things from 
them as well. The same is true with respect to other countries. Whether 
it is China, Japan, Europe or Korea, we should not any longer sit idly 
by and roll our eyes at trade agreements that are unfair to our workers 
and unfair to our companies.
  Let me again mention just one specific piece of information. I do not 
mean to pick on Korea for the sake of picking on Korea. I have spoken 
about the Chinese automobile trade previously. Korea, this year, if 
this year is similar to last year, will likely send us about 680,000 
Korean cars, all on ships, to be delivered to the United States, and to 
be sold in the United States--680,000 cars produced in Korea, with 
Korean labor, to be shipped to the United States.
  Do you know how many cars the United States will produce that we will 
be able to sell in Korea? Do you think it will be 680,000? No, 3,900. 
Do you know why? Because Korea does not want American cars sold in 
Korea. They had a little spurt once on the Dodge Dakota pickup, and 
they shut that down real quickly. So 680,000 cars coming this way; 
3,900 cars going from the United States to Korea.
  I think for us to put up with this stuff is unbelievable, just 
unbelievable, in its ignorance. I would say to the Koreans, with 
respect to that piece of bilateral trade, if that is what you want to 
do on bilateral automobile trade, then, for a while, why don't you sell 
your cars in Zambia? Just ship them to Zambia, and we hope you have a 
good commercial success with them. Very soon, they would understand 
they need the American marketplace, and in exchange for needing the 
American marketplace, to have their marketplace wide open to us.
  We know, those of us who will vote against this, and especially those 
who speak as I do, we know that the Washington Post, which will largely 
not run any op-ed pieces from those of us who hold our view, they and 
the other institutional thinkers on this will say: Well, do you know 
what you are? We have just heard you speak, and you basically ignore 
the world as it is. You are willing to reject the global economy, 
despite the fact that it exists and is there. And what you are is a 
xenophobic, isolationist stooge that simply is incapable of seeing over 
the horizon. You don't have the breadth of thought we do. And because 
you don't, you have a basic level of ignorance. That is how they treat 
people who do not buy into the jingoism of free trade.
  This country used to be known as a country of shrewd Yankee traders. 
We were good. Our country wants us to succeed. We should want us to 
succeed. And we want to help others succeed with trade relationships 
that help lift others up, not push us down. But I have described 
already what we have gone through in the last century.
  Unlike almost any other country on Earth, in the last century we 
decided some pretty basics things. And there are some people who had a 
tough time forcing these things to happen. I do not have the names of 
the people who were killed on the streets of America who were demanding 
the right for labor to be able to organize, but they died. Those who 
fought for a safe workplace, they suffered. Those who demanded a fair 
part of the income stream in this country for those who work for a 
living, they too paid the price for that. Those who fought, who said, 
belching chemicals into the air and water out of our factories, it is 
poisoning where we live, and you have to stop it--and they forced 
Congress to put an end to it--they paid a price for that as well.
  But we did all that. It made sense. And now all of a sudden we see 
that does not matter. What matters is to be able to pole-vault over all 
of those regulations and go set up a factory in Guangzhou and produce 
that commodity and send it to Pittsburgh. And the consumer may get a 
$25 lower bill for that commodity. The consumer probably lost their job 
to the worker in the factory in Guangzhou, but they are able to pay 
slightly less for that commodity. That is not a bargain for our 
country. It is a way for our country to lose economic strength and to 
lose its way.
  Now, let me just conclude by saying I have great hope for this 
country. If I did not have hope, I would not serve here in the Senate. 
We come here from a quiltwork of interests around the country--some big 
States and some small States, some big towns, some small towns, ivy 
league colleges and State schools. I come from a town of 300 people. I 
think it is a thrill every day to go to work. I think it is a special 
privilege to be here. If I did not have hope, I would not keep coming 
here, I would not have run for reelection last fall.
  I still have hope that, in the long run, we will understand that the 
path we are on cannot be sustained and there is a better path. And it 
is not a path that is selfish. It is not demanding ``us or nothing.'' 
It is just a path that understands our first responsibility is to 
nurture and strengthen and protect this country of ours and to do what 
we think is necessary to give our kids opportunities. We need to leave 
this place better than the way we found it. And that is not what is 
going to happen unless we change course.
  So I am on the floor of the Senate, not to preach but just to try to 
play a role in seeing if we cannot finally make a U-turn on these 
issues and head in the right direction, in a direction that says to our 
trading partners--China, Korea, Africa, South America, CAFTA, Central 
America--it says to them: Yes, we care about this. We want to help you. 
We want to work with you. But we do not want to do that at the expense 
of taking the American economy apart. We do not want to do that at the 
expense of saying to American families: We are busy helping somebody 
else down there, and so we do not have time to worry about your job.
  If this country says to the people who make bicycles, ``You are paid 
way too much. You are paid $11 an hour plus benefits. We cannot afford 
that. Those jobs go to China,'' there is destined, in my judgment, to 
be nothing but hopelessness for those who come after us. I do not 
believe we can allow that to be the case.
  I started by saying John Adams used to write back to his wife, when 
he was helping put this great country together, and asked her 
plaintively: Where is the leadership? Who will be the leaders? Where 
will the leadership

[[Page 15086]]

come from in this country? And the answer in every generation in 
America has been to provide that leadership. And that question is a 
loud question in this country, again. It begs for an answer. Who will 
be the leaders? Where will the leadership come from to put this country 
back on track, to put its economy back on track, so 5 years, 10 years, 
and 25 years from now we can see something that gives us some 
confidence and some faith this is going to be a better place for our 
children.
  Mr. President, I reserve the remainder of my time and yield the 
floor.


     U.S.-Dominican Republic, Central American Free Trade Agreement

  Ms. MIKULSKI. Mr. President, I rise to oppose the U.S.-Dominican 
Republic, Central American-Free Trade Agreement, CAFTA. I support free 
trade when it is fair trade. Yet this agreement is not fair for workers 
in America or in Central America.
  The truth is, this agreement will not dramatically change the trade 
relationship between the United States and our neighbors in Central 
America.
  Thanks to existing agreements, like the Caribbean Basin Initiative, 
there are relatively few trade restrictions today between the U.S. and 
the nations of CAFTA.
  The small increases in trade of textiles and agriculture products 
that will result under CAFTA represent a very modest increase in U.S. 
revenue. According to the U.S. International Trade Commission, CAFTA 
will generate a net increase in U.S. revenues of just 0.01 percent per 
year.
  So this agreement is not going to do much to help the American 
economy. But it contains provisions on labor, the environment and sugar 
that could harm America's working men and women and their families.
  I think we have widespread agreement that workers in the CAFTA 
countries face very difficult conditions.
  In most countries, workers have a very hard time trying to unionize 
and bargain collectively. Intimidation of union organizers is not 
unusual. It often goes unpunished.
  There is even a significant amount of child labor in some sectors in 
these countries.
  So CAFTA is a prime example of a trade agreement that must have 
strong labor provisions if it is to guarantee trade that is not just 
free, but fair.
  But there is only one labor provision in this agreement that is 
enforceable through the regular dispute settlement procedures, and it 
is a weak one.
  It does nothing more than require a country to enforce its own trade 
laws, no matter how weak. And if a company is found in violation of its 
national trade laws, the government pays the fine--not the company.
  That is not much incentive to encourage employers to abide by the law 
and treat their workers with respect and dignity.
  Let me be very clear about one thing. I support trade. I encourage 
trade. Trade is very important to my State. Maryland workers can 
compete successfully in a global marketplace, if they're given a level 
playing field. That's why I support expansion of fair trade.
  I have supported past trade agreements, like the Jordan Free Trade 
Agreement, that included strong, enforceable labor provisions. This 
agreement does not live up to those standards.
  CAFTA's weak labor provisions are a raw deal for American workers.
  They send a terrible message to the men and women in CAFTA nations 
who are trying to earn a fair wage to support their families.
  Our message to them is, we want to do business with the companies you 
work for, but we aren't concerned about how they treat you. That's not 
the message I want to send to our neighbors.
  On the environment, we also face some serious challenges in the CAFTA 
countries.
  As with the labor provisions, the environmental provisions in CAFTA 
are too weak. The one enforceable environmental provision simply 
requires countries to ``effectively enforce'' their own environmental 
laws.
  Again, I believe in free trade that is fair trade. And fair trade 
must include environmental protections. We need strong, enforceable 
environmental provisions to protect American jobs. We also need them to 
ensure that our neighbors have access to the same clean air and safe 
drinking water that we enjoy.
  Finally, Mr. President, I am very concerned that CAFTA unfairly 
exposes the American sugar industry without opening other markets for 
U.S. sugar.
  Even the administration recognizes that CAFTA as it was negotiated 
will unfairly target our sugar industry. That is why they have come up 
with a complicated scheme to pay CAFTA-nation governments and sugar 
producers not to export sugar to America.
  But this deal is no deal for the men and women of America's sugar 
industry. And it is no deal for the American taxpayer who, under this 
plan, would pay between $150 million and $200 million a year to foreign 
governments and companies.
  It makes no sense to negotiate an agreement that opens U.S. markets 
to foreign sugar and then pay foreign producers not to take advantage 
of that agreement.
  Even this flawed plan would not do enough to protect the U.S. sugar 
industry from unfair trade. It would expire after just two years, 
exposing the U.S. market to cheap, low quality imports.
  And it does nothing to open large, protected sugar markets in Europe 
that remain closed to U.S. sugar exports.
  I support the idea of developing stronger ties between the U.S. and 
our neighbors in Central America.
  These nations have made great strides toward democracy and openness. 
We should work more closely with them to support their recent gains in 
the rule of law and efforts to fight terrorism, organized crime and 
drug trafficking.
  But this trade agreement is seriously flawed. It does not do much to 
increase free trade, and it certainly does nothing to support fair 
trade. It is not fair to American workers and their families, and it is 
not fair to workers in Central America. I will vote no, against CAFTA.
  Mr. LEAHY. Mr. President, I cannot in good conscience support the 
CAFTA agreement as proposed by the Administration. I reviewed this 
agreement carefully and evaluated the arguments of both sides. Exports 
play a central role in the economy of my home State of Vermont, where 
some of the finest specialized goods in the world are made, from 
computer chips to cheese. Free and fair trade benefits us as 
Vermonters, and it benefits the country. I have often voted in favor of 
various trade agreements, including NAFTA and recent bilateral trade 
accords with Jordan, Singapore, and Chile.
  I strongly believe free trade and the agreements that facilitate it 
will be critical to the well being of my State and our country in the 
years ahead. But we have a responsibility to ourselves and those we 
trade with to make sure these agreements are soundly predicated, are 
fair to both sides, are constructed to advance the interests of the 
many and not just a few, and that they will protect the environment 
upon which we all ultimately depend. I do not believe this trade 
agreement adequately meets these tests, and I cannot in good conscience 
vote for CAFTA.
  I have great respect for some of Central America's leaders who favor 
this agreement. I know they have the interests of their countries at 
heart. But I believe they overstate the positive effects this agreement 
would have and give too little weight to negative effects. The weak 
labor and environmental provisions of this agreement will do little to 
help the hardworking men and women of Latin America, and in fact may 
make their already difficult lives even harder and more dangerous.
  I also believe that this agreement is a diversion from the larger 
trade issues that will make a real difference for the long-term health 
of our own economy. This deal should be carefully and conscientiously 
re-negotiated to adequately address these pressing concerns.
  There has been a lot of ink spilled from the administration and from

[[Page 15087]]

groups representing particular interests arguing that CAFTA will be a 
significant boost to the U.S. economy. When you are talking about 
Central American economies that have a combined gross domestic product 
of a medium-sized U.S. city, this argument just does not carry weight. 
Yes, U.S. consumers might be able to buy some Central American exports 
at a cheaper price. And, yes, U.S. manufacturers might gain greater 
access to these markets. But these countries are so small that the 
impact on the U.S. economy will be negligible. For instance, this 
agreement would help the dairy producers in my home State of Vermont 
only marginally, at the very best.
  We all know that when we talk about trade, what makes a real 
difference for the economy is trade with our larger trading partners--
Europe, the NAFTA countries of Canada and Mexico, several Far East 
Asian countries--but, above all, China. Yet we have an enormous trade 
deficit with China today that threatens interest rates and the strength 
of the dollar.
  China has maintained an artificially low exchange rate, removed 
voluntary export quotas, and continually infringed on international 
patents and copyrights. It does not seem that this administration has 
any strategy for dealing with these unfair trade practices, let alone 
with the fact that China's GDP is growing at almost 10 percent every 
year and will challenge us economically in the decades ahead. It is a 
wonder to me that the administration is seeking trade agreements that 
are not part of a comprehensive strategy to deal with this kind of 
continually escalating foreign competition.
  While this agreement will not make much difference for our economy, 
it is likely to have significant negative impacts on the countries of 
Central America, and we should be concerned for the people of those 
impoverished countries. Over the past several decades, dictatorships, 
civil wars and fierce class struggles have buffeted the region, 
particularly during the Cold War when the larger geopolitical 
struggle--in which we were a central player--exploited and heightened 
these local tensions. These countries have set out on a new, democratic 
path over the past year, and our foreign policy should encourage these 
favorable developments. Unfortunately, the weak labor and environmental 
laws of these countries and the complete failure of this agreement to 
elevate and strengthen those standards ensures that any growth that 
rises out of the agreement is unlikely to translate into significant 
real gains for everyday workers and the broader population.
  Under CAFTA, participating countries are only forced to abide by 
their own often weak and rarely enforced labor laws. Sadly, an 
oligarchic culture persists in these countries, whereby wealthy 
business and landowners rarely trickle down profits to the hardworking 
men and women who do the work. Without stronger labor provisions that 
provide increased benefits and protections to workers, CAFTA will do 
little to change that culture.
  A recent World Bank report on the agreement found that Central 
American countries will have to boost spending for schools and rural 
infrastructure to take full advantage of the agreement's benefits. 
Those investments are not realistically forthcoming, and this 
administration has not shown a serious commitment to supporting this 
type of development in those nations to make up the difference. This is 
a lost opportunity. At the same time, CAFTA will displace poor 
subsistence farmers who will abandon their land and follow in the 
footsteps of those who have come illegally to the United States in 
search of employment. And CAFTA will contribute to ongoing 
environmental problems associated with manufacturing and the pesticides 
used in large-scale agriculture.
  I urge the President to send his trade negotiating team back down to 
Central America to rework this deal. We need a better agreement that 
reaches the so-called Jordan Standard, including the strong labor and 
environmental provisions of the United States-Jordan Bilateral Free 
Trade Agreement that we ratified a few years ago.
  More importantly, I hope the President will deal with the mounting 
pile of economic and trade problems that really do have profound 
consequences to our economy and the living standards of the American 
people. Let's come up with a broader approach to trade that addresses 
unfair trading practices, that reduces our ballooning trade deficit, 
that boosts our economy, and that protects the environment and the 
rights of workers. I look forward to working with this or any other 
administration on these challenges. I cannot cast a vote for an 
agreement like this that over-promises and under-delivers to the 
workers of our own country and to the people of Central America.
  Mr. KOHL. Mr. President, I rise today to express my strong opposition 
to the CAFTA implementing legislation before us today. Unlike NAFTA, 
CAFTA won't encourage the migration of a large number of manufacturing 
jobs out of the country or significant worsen our already terrible 
trade deficit; CAFTA countries only account for 1.5 percent of total 
U.S. trade. And unlike the U.S.-Australia free trade agreement which 
put my State's dairy farmers at a competitive disadvantage, CAFTA harms 
most industries like sugar and textiles that do not have a large 
presence in Wisconsin.
  But there are bigger reasons to reject CAFTA today--reasons that 
apply across all regions of the country and should convince all 
Senators. We should reject CAFTA because it makes equal trading 
partners out of countries with labor and environmental standards far 
below those in the United States. Instead of using our negotiating 
power with these countries to lock in improvements in these standards, 
CAFTA establishes rules on workers' rights that take a step backward 
from the labor conditions that exist in current trade programs with 
Central America.
  When we make deals like CAFTA, we do more than give up jobs to low-
wage countries. When we make deals like CAFTA, we accept and encourage 
a global economy where workers' rights, living wages, and humane 
treatment are an anachronism. When we make deals like CAFTA, we tell 
U.S. businesses that the tough environmental standards they live by--
and pay for--are not necessary for their overseas competitors. Why does 
the continuing flow of jobs moving overseas surprise us given this 
message--a message sent by our top trade officials and negotiators?
  In a region where labor laws fall far short of minimum international 
standards and where workers are routinely intimidated, fired, and 
threatened for trying to exercise their most basic rights on the job, 
CAFTA's move backwards on workers' rights is unacceptable. As a 
businessman, I understand that trade agreements that open markets can 
be good for the economy--but not if they do so by accepting as the 
global norm the least common denominator in labor and environmental 
standards.
  The administration has agreed to support $40 million per year from 
fiscal year 2006 to fiscal year 2009 to aid CAFTA countries with their 
labor and environmental protection programs and an additional $30 
million per year over the same period to assist farmers in CAFTA 
countries who may be displaced by the expected increase of agricultural 
imports from the U.S. Mr. President, I am in favor of opening 
international markets for U.S. goods, but why do we need to spend $190 
million over 3 years to have countries trade with us? Wouldn't it have 
been easier to have CAFTA countries work with the International Labor 
Organization to develop the capacity to monitor and enforce labor and 
environmental protections?
  At a time when the trade deficit keeps rising--$655 billion in fiscal 
year 2004 up from $530 billion in fiscal year 2003--and the Federal 
deficit is at an all-time high, the U.S. needs to negotiate free-trade 
agreements where both sides play by the same rules. When I meet with 
constituents and the conversation turns to trade or jobs, the topic of 
China inevitably comes up and I am asked what we are going to do about 
China. Mr. President, what are

[[Page 15088]]

we going to do about China? I certainly have trouble trusting those who 
negotiated CAFTA to work out the answer to that dilemma--an answer that 
will have a much larger and more direct impact on our economy.
  We cannot remain competitive with countries that pay their workers 
next to nothing, have no labor or environmental standards, and who 
offer their employees little or no health care. Yet we are considering 
a trade agreement right now that asks us to do just that. And though 
the CAFTA countries are not large enough to impact our economy 
significantly, the precedent set by agreements like CAFTA--and the 
attitude among our trade negotiators that CAFTA reveals--will. We are 
the strongest economy in the world and can and should be able to 
compete and prosper in a global marketplace. But we will not if we 
continue to sign up for trade agreements that allow other countries to 
undercut us by producing goods using underpaid, abused labor and 
unacceptable environmental practices. I urge my colleagues to reject 
CAFTA--and reject the misguided, eventually disastrous trade policy it 
represents.
  Mr. DOMENICI. Mr. President, I am a long-time supporter of free trade 
agreements because I believe free trade agreements can be beneficial to 
everyone. Free trade agreements have a positive impact on the job 
market and the economy.
  I have spent many hours listening to this body debate the Dominican 
Republic-Central American-United States Free Trade Agreement (DR-
CAFTA). Upon careful consideration of the issues at stake in this 
important economic measure, I have come to the conclusion that the 
ratification of DR-CAFTA will result in the growth of our national 
economy. Additionally, DR-CAFTA's passage will represent an enormous 
step towards increased prosperity in Central America.
  The reasons to support DR-CAFTA are numerous. The measure is 
favorable to our Nation's export market. DR-CAFTA countries currently 
make up the twelfth largest market for U.S. exports, with those 
countries purchasing more than $15.1 billion in U.S. exports in 2003. I 
believe we should do what we can to foster additional growth in that 
market. Passage of DR-CAFTA will do just that. In addition, DR-CAFTA is 
favorable to our country's textile suppliers. Passage of this bill will 
put our suppliers on a level playing field with their counterparts in 
Asia.
  I believe that the argument that DR-CAFTA will represent an exodus of 
jobs and dollars to Central America is unfounded. Under the status quo, 
80 percent of all imports from Central America and 99 percent of 
agricultural imports from Central America enter the United States duty 
free. In contrast, many American farmers suffer from the burden of 
tariffs ranging from approximately 7 percent in the case of Nicaragua 
to 23 percent for certain products from the Dominican Republic. 
Creating a more equitable duty system for agricultural imports and 
exports is important to my home State of New Mexico, which is heavily 
involved in the agricultural industry.
  This agreement is also important to New Mexico because an estimated 
$234 million worth of products, many of them semi-conductors and 
electronics, were exported from New Mexico to DR-CAFTA countries in 
2004. This ranked New Mexico thirteenth among U.S. States exporting 
goods to CAFTA countries. Clearly, my home State will benefit from a 
free trade agreement with these Central American countries.
  DR-CAFTA is important to our country. It is a pro-export, pro-worker, 
pro-agriculture, pro-economy trade agreement, and I appreciate the 
efforts of the administration and our trade negotiators in crafting 
such an agreement. I am proud to vote in favor of DR-CAFTA.
  Mr. HAGEL. Mr. President, I rise today in strong support of the 
Central American Free Trade Agreement. CAFTA will be one of the most 
important pieces of legislation considered by the Congress this year. 
Passage of CAFTA means increased markets for our agricultural products 
and manufactured goods to the nations of Central America--Costa Rica, 
El Salvador, Guatemala, Honduras, Nicaragua--and the Dominican 
Republic. Already, 47,000 Nebraska jobs are supported by exports of 
farm products. CAFTA means more of these jobs across the United States.
  Passing CAFTA will further open new markets for beef, corn, soybeans 
and other products by lowering and eliminating tariffs on U.S. goods in 
CAFTA countries. Currently, U.S. goods exported to CAFTA countries face 
significant tariffs. Despite these tariffs, the U.S. exports more than 
$15 billion to CAFTA countries every year. Nebraska exported over $19.5 
million worth of goods to CAFTA countries in 2004, according to the 
Department of Commerce. With these tariffs eliminated, this region 
provides significant potential for States like Nebraska which depend on 
our ability to export our products. The Office of the United States 
Trade Representative views Central America as a larger market for U.S. 
products than India, Indonesia, and Russia combined.
  All previous trade agreements have benefitted the United States 
economy. Since the North American Free Trade Agreement was signed in 
1993, trade among NAFTA nations rose 150 percent. Nebraska's combined 
exports to Canada and Mexico have increased by more than 160 percent. 
In the first year of the U.S.-Chile Free Trade Agreement, U.S. exports 
to Chile grew 33.5 percent.
  There are those who have argued that there is a danger to the U.S. 
sugar industry if CAFTA is passed into law. They are worried about 
sugar from the Dominican Republic and Central America crowding out 
domestically produced U.S. sugar. These fears, while understandable, 
don't hold up against the facts. Under the current U.S. Farm Bill, 
Congress set an import ceiling of about 1.4 million metric tons of 
sugar. The domestic sugar program is unaffected when imports are below 
this limit. Currently, the U.S. is not close to exceeding that ceiling. 
According to the U.S. Trade Representative, in the first year of the 
agreement, increased access to the U.S. sugar market will be equal to 
little more than one day's sugar production in the United States.
  CAFTA has stronger protections for workers than any other Free Trade 
Agreement. It has a three-part strategy that will ensure effective 
enforcement of domestic labor laws, establish a cooperative program to 
improve enforcement of domestic labor laws, and enhance the ability of 
Central American governments to monitor and enforce labor rights.
  Trade is an opportunity, not a guarantee. CAFTA is supported by over 
50 agricultural industry and farm groups, including the Nebraska Farm 
Bureau and the Nebraska Corn Growers.
  Ultimately, the argument for CAFTA is not about numbers on a page or 
statistics, it is about American families and communities that need the 
opportunities provided by these markets to grow and remain competitive. 
CAFTA is good for the United States. I urge my colleagues to vote for 
this trade agreement.
  Mrs. BOXER. Mr. President, I am opposed to and will vote against the 
Central America Free Trade Agreement, CAFTA.
  I am not against trade agreements, provided they are fair. But when 
those agreements unfairly disadvantage American workers and businesses, 
I oppose them.
  I could vote for CAFTA if it meant more jobs in America and a 
stronger American economy. But, I do not believe that is the case. 
Because of CAFTA, Americans will lose jobs and manufacturing will move 
overseas.
  CAFTA will not foster free trade; it will result in unfair 
competition. Most of the Central American governments are notoriously 
lax in enforcing their labor laws. Under CAFTA, the Central American 
countries pledge to enforce their labor laws and strive to ensure 
workers' rights are protected, but these are merely ``paper pledges.'' 
Moreover, unlike other trade agreements, the mechanisms for forcing the 
Central American governments to enforce their own labor laws are 
limited and the penalties for noncompliance

[[Page 15089]]

are negligible. Worse still, nothing in CAFTA prohibits a country from 
further relaxing its existing laws.
  In addition, most Central American countries do not have strong 
environmental protection laws, and enforcement of the laws that do 
exist is limited. Companies are permitted to destroy the environment 
and harm their workers in order to produce cheaper products for export.
  U.S. manufacturers and workers are the best in the world. Their 
productivity and innovation cannot be matched. But even they cannot--
nor should they have to--compete with foreign companies that have weak 
labor protections and that ignore the environment in order to cut 
prices.
  After careful consideration, I have come to the conclusion that CAFTA 
will result in American workers losing their jobs, U.S. companies 
closing their doors, a downward pressure on wages, and a worsening 
trade deficit.
  For these reasons, I cannot support CAFTA and will vote against it.
  Mr. KYL. Mr. President, I want to express my support for the Central 
America Free Trade Agreement, which is not just important for job 
creation and business opportunities in Arizona, but for the economic 
and political futures of five Central American countries and the 
Dominican Republic, all of which are eagerly awaiting the passage of 
this trade agreement. CAFTA will enhance both economic and political 
ties between Central America and the United States. It will also help 
promote freedom and democracy in our own Hemisphere.
  The United States exports $15 billion annually to the CAFTA-DR 
countries--El Salvador, Honduras, Costa Rica, Nicaragua, Guatemala, and 
the Dominican Republic. This is more than our exports to Russia, India, 
and Indonesia combined. In my home State of Arizona, our top 
agricultural exports to the region are beef, vegetables, and cotton. We 
also exported more than $208.9 million in manufactured goods to CAFTA 
countries. The American Farm Bureau estimates that CAFTA will increase 
farm exports from Arizona to CAFTA countries by $8 million per year for 
beef, $1 million per year for vegetables, and $800 thousand per year 
for cotton, part of a total future annual increase of $12.14 million in 
agricultural exports over the anticipated pre-CAFTA growth level. The 
total national increase in agricultural products to CAFTA countries is 
estimated at over $1.5 billion, and manufacturing exports nationwide 
will increase dramatically as well, which is great for Arizona where 25 
percent of the manufacturing jobs depend on exports. CAFTA will also 
reduce the U.S. trade deficit by $756 million.
  While the U.S. economy has been growing steadily over the past 2 
years, creating record numbers of new jobs, we can expect even more 
growth with the passage of CAFTA. That, in turn, will foster the growth 
of Central American economies. Take, for example, the textile industry 
in the Central-America region. The CAFTA countries are the largest 
consumers of U.S. apparel and yarn exports, and the second largest 
consumers of U.S. fabric exports. 11,000 Arizonan jobs are supported by 
the textile industry, and approximately 700,000 Americans are employed 
in the yarn and textile sectors. The yarn and fabric we create and 
export to Central America and the Dominican Republic support another 
500,000 jobs in the apparel sector in those countries. By working 
together, the United States and CAFTA countries can more efficiently 
compete with large textile markets such as those in the Asia region. 
With the expiration in 2004 of global multi-fiber quotas in effect 
since the 1970s on textiles and apparel, regional producers face a new 
competitive challenge from Asian imports. CAFTA would provide regional 
garment-makers--and their U.S. or regional suppliers of fabric and 
yarn--a critical advantage in competing with Asia.
  Many Arizona farmers and businessmen are excited about the economic 
growth CAFTA will bring them. There is also just as much excitement in 
Central American countries. I have been to El Salvador and I can tell 
you that people there are looking to the United States to pass CAFTA to 
give them better opportunities and a higher standard of living. They 
have hope that their country's economy will see dramatic growth, 
increasing jobs and the wages that those jobs pay. Without CAFTA, they 
fear that jobs once performed by El Salvadorian workers will be moved 
to Asia.
  CAFTA gives El Salvadorians hope for a better economic future, which 
means a more stable and peaceful future, through rising wages, 
decreasing unemployment rates, and more affordable basic commodities. 
This will raise the standards of living in El Salvador, as well as the 
other countries in this region. The President of El Salvador has said 
that CAFTA matters most to his country because it will strengthen the 
foundations of democracy by promoting economic growth, providing a 
solution to the persistent problem of poverty, and creating equality of 
opportunity. And by addressing the underlying problems of poverty and 
unequal economic opportunities, CAFTA will help stem the tide of 
thousands of Central Americans who leave their homes seeking a better 
life in neighboring countries to the north. CAFTA will help Central 
Americans to earn better livings and successfully support their 
families in their home countries.
  Economic growth fosters stability and peace throughout this region. 
To strengthen democracy in the region, its people need to see concrete 
benefits from economic freedom--tangible improvements in their daily 
life. When a middle class develops and people have a larger economic 
stake in their society, they demand more of a say in how that society 
is run. This is critical for a region's democratic success.
  We can be instrumental in the region's democratic, as well as 
economic, success by passing CAFTA now. If we fail to pass CAFTA, 
America will be turning its back on the hopes and dreams of our 
southern neighbors.
  I ask unanimous consent to have printed in the Record a copy of the 
Republican Policy Committee's recent policy paper, ``The U.S.-Dominican 
Republic-Central American Free Trade Agreement is a Win-Win.'' This 
paper goes into further detail as to why the CAFTA agreement is in 
America's interest.
  There being no objection, the material was ordered to be printed, as 
follows:

 United States-Dominican Republic-Central America Free Trade Agreement 
                              Is a Win-Win


                           executive summary

       Congress should soon pass the United States-Dominican 
     Republic-Central America Free Trade Agreement (DR-CAFTA). 
     This important agreement expands market access for U.S. 
     exporters of manufactured goods, agriculture products, and 
     services.
       On February 20, 2004, President Bush notified Congress of 
     his intent to enter into a free trade agreement with the 
     Central American nations of Costa Rica, El Salvador, 
     Honduras, Guatemala, and Nicaragua. The Dominican Republic 
     became a party to CAFTA on August 5, 2004.
       The Central American markets are significant to the 
     American economy: the DR-CAFTA countries constitute our 12th 
     largest export market with a consumer base of nearly 44 
     million.
       Passage of DR-CAFTA is vital to the economic and security 
     interests of both the United States and the DR-CAFTA 
     countries, and it will demonstrate the U.S. commitment to 
     foster economic prosperity in the region. It will serve to 
     nurture democracy, transparency, and respect for the rule of 
     law in a region that, only decades ago, was marked by 
     internal strife.
       Commonly heard arguments against DR-CAFTA include concern 
     that U.S. sugar producers will be adversely affected, that 
     American textile jobs will be lost, and that Central American 
     workers' rights and the environment will be harmed.
       The Bush Administration counters that passage of this 
     agreement is a win-win for all parties and that it will 
     preserve the U.S. sugar program, level the playing field for 
     U.S. workers, strengthen freedom and democracy in the region, 
     enable U.S. textile suppliers to compete with Asia, and 
     enhance the enforcement of labor and environmental laws in 
     the region.
       Among the significant consequences of failing to pass the 
     DR-CAFTA would be: (1) a message that the U.S. is not 
     committed to open market principles; (2) the continuation of 
     high tariff barriers on U.S. exports to the region; and (3) 
     the loss of an important export market for numerous U.S. 
     suppliers of cotton, yarns, and fabrics.
       This paper addresses concerns expressed about the agreement 
     and highlight the broad

[[Page 15090]]

     support DR-CAFTA is receiving from many different sectors of 
     the U.S. economy.


                              Introduction

       Congress will soon consider whether to pass the United 
     States-Dominican Republic-Central America Free Trade 
     Agreement (DR-CAFTA). This important agreement builds on 
     other recent trade agreements by substantially expanding 
     market access for U.S. exporters of manufactured goods, 
     agriculture products, and services. In fact, DR-CAFTA will 
     level the playing field with our southern neighbors by 
     providing reciprocal access for U.S. businesses to the 
     markets of Central America and the Dominican Republic, which 
     already enjoy liberal access to the U.S. market.
       On February 20, 2004, President Bush notified Congress of 
     his intent to enter into a free trade agreement with the 
     Central American nations of Costa Rica, El Salvador, 
     Honduras, Guatemala, and Nicaragua. [Text of a letter from 
     the President to the Speaker of the House of Representatives 
     and the President of the Senate, February 20, 2004.] On May 
     28, U.S. Trade Representative Robert Zoellick fulfilled the 
     President's pledge and signed the U.S.-Central America Free 
     Trade Agreement. The Dominican Republic became a party to 
     CAFTA on August 5, 2004.
       The United States has much to gain from this agreement 
     because the Central American markets are significant to the 
     American economy. The DR-CAFTA countries constitute our 12th 
     largest export market with a consumer base of nearly 44 
     million. [U.S. International Trade Commission (ITC), ``U.S.-
     Central America-Dominican Republic Free Trade Agreement: 
     Potential Economy-wide and Selected Sectoral Effects,'' 
     August 2004.] Nearly 80 percent of Central American products 
     already enter the United States duty-free due to unilateral 
     preference programs such as the Caribbean Basin Initiative 
     and the Generalized System of Preferences. CAFTA will 
     eliminate these one-way barriers and provide reciprocal free 
     trade. The Agreement will also provide a chance to unite with 
     customers in the region to better compete against China, 
     especially in apparel and textiles.
       The DR-CAFTA agreement will also serve to nurture 
     democracy, transparency, and respect for the rule of law, in 
     a region which only decades ago was marked by internal 
     strife. Today the Central American nations and the Dominican 
     Republic are democracies wanting to strengthen economic ties 
     which will in turn reinforce their progress in political and 
     social reform. Passage of DR-CAFTA is, thus, vital to the 
     economic and security interests of both the United States and 
     the DR-CAFTA countries, and it will demonstrate the U.S. 
     commitment to foster economic prosperity in the region.
       Despite the great appeal of this agreement to many sectors 
     of the American economy, there are some groups that remain 
     opposed to it. Commonly heard arguments against DR-CAFTA 
     include concern that U.S. sugar producers will be adversely 
     affected, that American textile jobs will be lost, and that 
     Central American workers' rights and the environment will be 
     harmed. [Representative Hilda Solis (D-CA), Congressional 
     Record, March 1, 2005; Representative Sherrod Brown (D-OH), 
     Congressional Record, March 2, 2005.] The Bush Administration 
     counters that passage of this agreement is a win-win for the 
     United States, the Dominican Republic, and Central America 
     that will preserve the U.S. sugar program, level the playing 
     field for U.S. workers, strengthen freedom and democracy in 
     the region, enable U.S. textile suppliers to compete with 
     Asia, and enhance the enforcement of labor and environmental 
     laws in the region. [Office of the U.S. Trade Representative 
     (USTR), ``DR-CAFTA Facts: The Case for DR-CAFTA,'' February 
     2005.]
       This paper will examine the benefits of DR-CAFTA for the 
     United States, the Dominican Republic, and Central America. 
     This paper will also address concerns expressed about the 
     agreement and highlight the broad support DR-CAFTA is 
     receiving from many different sectors of the U.S. economy. 
     And, it will review the consequences to the United States, 
     the Dominican Republic, and Central America if Congress 
     should fail to pass the trade agreement.

    Why DR-CAFTA is a Win-Win for the United States, the Dominican 
                     Republic, and Central America


  Economic Benefits--leveling the playing field for American exporters

       The DR-CAFTA market provides a large export market for the 
     United States. As an integrated market, Central America, and 
     the Dominican Republic purchased more than $15.1 billion in 
     U.S. exports in 2003. [USTR, ``Trade Facts: Free Trade with 
     Central America, Summary of the U.S.-Central America Free 
     Trade Agreement,'' December 17, 2003.] By tearing down tariff 
     barriers, American workers will be able to gain better access 
     to the 44 million consumers living in the Dominican Republic 
     and Central America. Moreover, population in this region is 
     expected to grow by almost 20 percent by 2015, thus adding 
     nearly 10 million new consumers to the marketplace. 
     [Population Division of the Department of Economic and Social 
     Affairs of the United Nations Secretariat, World Population 
     Prospects: The 2004 Revision and World Urbanization 
     Prospects: The 2003 Revision.]
       While the DR-CAFTA countries buy many goods and services 
     from the United States, it is economically important to the 
     U.S. economy to level the playing field on trade between the 
     United States, the Dominican Republic, and Central America. 
     Due to trade preference programs currently in place, 80 
     percent of all Central American goods currently enter the 
     United States duty-free, while the average tariff imposed on 
     U.S. exports to Central America is between 7 and 9 percent. 
     [Chris Padilla, ``DR-CAFTA: A Vote for Freedom, Democracy, 
     Reform,'' Textile News, February 28, 2005.] Some tariffs on 
     many farm goods are as high as 16 percent. [USTR, ``DR-CAFTA 
     Facts: CAFTA Levels the Playing Field,'' February 2005.] 
     These high tariffs hurt our ability to export to and compete 
     in the growing markets of the Dominican Republic and Central 
     America. In addition, U.S. exporters face numerous non-tariff 
     barriers that currently inhibit their ability to export goods 
     and services to the region.
       Upon full implementation of DR-CAFTA, U.S. products will 
     enter the Dominican Republic and Central America duty-free. 
     In fact, 80 percent of consumer and industrial goods exports 
     are immediately duty-free upon enactment of the agreement, 
     with the remaining 20 percent becoming duty-free over 10 
     years. Key U.S. export sectors will benefit including medical 
     and scientific equipment, information technology products, 
     construction equipment, and paper products.
       The agreement will expand markets as well for U.S. 
     agriculture. Currently, U.S. tariff barriers to agricultural 
     exports from DR-CAFTA countries are much lower than tariffs 
     faced by U.S. agricultural exports to DR-CAFTA countries. 
     [USTR, ``DR-CAFTA Facts: CAFTA Levels the Playing Field,'' 
     February 2005.] According to the USTR, more than half of 
     current U.S. farm exports to Central America will become 
     duty-free immediately, including cotton, wheat, soybeans, 
     fruits and vegetables, high-quality cuts of beef, processed 
     food products, and wine. Tariffs on remaining farm items will 
     be phased out over 15 years. [USTR, ``Trade Facts: Free Trade 
     with Central America, Highlights of the U.S.-Central America 
     Free Trade Agreement,'' January 27, 2004.] On May 28, 2004, 
     the American Farm Bureau Federation (AFBF), a national 
     organization representing U.S. farmers and ranchers across 
     the country, stated that the ``U.S.-Central American Free 
     Trade Agreement will provide a substantial competitive 
     advantage to U.S. agriculture,'' and that the Bush 
     administration has ``opened up promising trade potential for 
     the whole of U.S. agriculture.'' [Statement by Bob Stallman, 
     President of the American Farm Bureau Federation regarding 
     the signing of the U.S.-Central American Free Trade 
     Agreement, May 28, 2004.] It estimates that U.S. agricultural 
     producers will increase their exports by $900 million as a 
     result of the DR-CAFTA agreement.
       In the area of services, the DR-CAFTA countries will accord 
     substantial market access across their entire services 
     regime, offering new access in sectors such as 
     telecommunications, computer services, tourism, financial 
     services, insurance, and entertainment among others. The 
     agreement also provides state-of-the-art protections and non-
     discriminatory treatment for digital products such as U.S. 
     software, music, text, and videos. Protections for U.S. 
     patents and trademarks are strengthened.
       The benefits of DR-CAFTA will be numerous. In its analysis 
     of DR-CAFTA implementation, the U.S. International Trade 
     Commission (ITC) found the effect of trade facilitation would 
     likely ``benefit U.S. producers, exports, service providers, 
     and investors.'' [ITC, 2004.] The USITC noted that, ``after 
     tariff liberalization has been fully implemented and all 
     economic adjustments have occurred under the FTA, overall 
     U.S. welfare is likely to increase in the range of $135.31 
     million to $248.17 million.'' [ITC, 2004.] U.S. exports to 
     DR-CAFTA countries are likely to increase by $2.7 billion (or 
     15 percent), and U.S. imports are likely to increase by $2.8 
     billion (or by 12 percent). [ITC, 2004.]
       DR-CAFTA also provides an atmosphere and, more importantly, 
     a legal framework for guaranteeing the security of American 
     investment in Central America. As noted by some policy 
     analysts: ``By locking in these liberal economic policies, 
     [DR-CAFTA] offers investors certainty that policies will not 
     suddenly reverse--a key component in investment decisions.'' 
     [Brett D. Schaefer and Stephen Johnson, ``Backgrounder #1822: 
     Congress Should Support Free Trade with Central America and 
     the Dominican Republic,'' The Heritage Foundation, February 
     8, 2005.] An open and transparent legal framework will 
     encourage investment and economic growth in a region of the 
     world that needs foreign capital to grow its economy and 
     create jobs.


            Political benefits--promoting regional stability

       In the 1970s, every Central American country except Costa 
     Rica and Belize were ruled by military dictators. Lack of 
     democracy and lack of economic opportunity led to communist 
     insurgencies in many parts of the

[[Page 15091]]

     region that were only defeated with the support of the United 
     States. [Ed Greser, Progressive Policy Institute Policy 
     Report, ``DR-CAFTA: The United States and Central America 10 
     Years After the Wars,'' October 2003.] Today, democracy 
     flourishes in the region. People can freely choose their 
     elected leaders. Through free-market economic reforms and 
     U.S. trade preference programs, workers' wages are now on the 
     rise and the standard of living throughout the region has 
     generally improved. Many observers agree that DR-CAFTA will 
     help lock recent political and economic gains into place by 
     bolstering transparency and the rule of law, thereby 
     attracting additional investment which will help to foster 
     continued growth and stability in the region. [See, e.g., The 
     Los Angeles Times, editorial, November 18, 2004; USTR, ``DR-
     CAFTA Facts: Emphatically Yes,'' February 2005; Stuart E. 
     Eizenstat and David Marchick, ``Trade Wins,'' Wall Street 
     Journal, March 8, 2005.]
       Twenty years ago, trade between Central America and the 
     United States was minimal. In 1984, trade between the U.S. 
     and CAFTA countries totaled $798 million compared to $3.6 
     billion in 2003--an increase of nearly 350 percent. 
     [Statistical data provided by USTR.] During the past few 
     years, significant progress has been made in Central American 
     economic integration, including a May 2000 free trade 
     agreement between Mexico and El Salvador, Guatemala, and 
     Honduras. In December 2001, an agreement was signed to 
     interconnect the electricity networks of the Central American 
     countries, allowing for regional power trading among the 
     member states beginning in 2006. [U.S. Department of Energy, 
     Energy Information Administration, ``Regional Indicators: 
     Central America,'' September 2004.] The integration of 
     electricity grids is only one of several initiatives by the 
     Inter-American Development Bank's Puebla-Panama Plan, which 
     seeks to promote regional development and integration of 
     Central American countries. [U.S. Department of Energy, 
     2004.]
       Public opinion throughout Central America finds that people 
     want to have a strong trading relationship with the United 
     States and want to see DR-CAFTA enacted. According to recent 
     State Department polling, the opinion pattern throughout the 
     region shows that, in most of the CAFTA countries, half of 
     those polled are aware of the trade agreement (up from about 
     a third in 2002-2003). Among those, a majority perceive 
     benefits for their country (e.g., 57 percent in D.R.; 56 
     percent in Costa Rica; and 56 percent in Nicaragua). [Memo 
     from U.S. State Department to Senate Finance Committee on 
     ``Central American Attitudes Toward CAFTA,'' March 16, 2005.] 
     Anticipated benefits include job creation, lower prices, and 
     a wider variety of goods available to consumers.
       Passage of DR-CAFTA by the U.S. Congress will help 
     reinforce the positive image many Central Americans have of 
     the United States, and will show that America does not view 
     Central America only as a trading partner. It will show that 
     the United States believes it has a stake in the development 
     of its neighbors. During his confirmation hearing before the 
     Senate Foreign Relations Committee on February 15, then 
     Deputy Secretary of State nominee Robert Zoellick stated that 
     ``economic power is a very important component of America's 
     power'' and that ``economic freedom is linked to political 
     freedom,'' and so ``how we integrate those can build on some 
     of America's values and its interests.'' [Remarks by Robert 
     B. Zoellick during a hearing of the Senate Foreign Relations 
     Committee on his nomination to be Deputy Secretary of State, 
     February 15, 2005.]
       The United States has long fought for democracy and 
     economic freedom for the people of Central America. DR-CAFTA 
     would reinforce democratic and free-market processes through 
     such provisions as transparency and anti-corruption measures. 
     It will also strengthen new democracies and leaders who are 
     working to grow their economies, reduce poverty, fight crime, 
     and deepen the roots of democracy.

                         Criticisms of DR-CAFTA


                                 Sugar

       Some charge the DR-CAFTA will greatly harm U.S. sugar 
     producers due to increased imports of sugar. In fact, U.S. 
     imports of sugar from the DR-CAFTA countries are today 
     limited by tariff rate quotas (TRQs) currently imposed by the 
     United States on each DR-CAFTA country, [ITC, 2004.] and this 
     system (albeit with slightly increased import amounts) will 
     remain in place with DR-CAFTA.
       Under the TRQs, sugar from the DR-CAFTA countries enters 
     duty-free if it is within quota. [ITC, 2004.] Sugar imported 
     over-quota is assessed high tariffs, which are in effect 
     prohibitive tariffs [ITC, 2004.] (of over 100 percent). 
     [USTR, ``DR-CAFTA Policy Brief, Sugar: A Spoonful a Week,'' 
     February 2005.] Because of the high over-quota tariffs, 
     imports of sugar from the DR-CAFTA countries essentially 
     correspond to their TRQ levels. [ITC, 2004.] It is important 
     to note that TRQs on sugar imports from the DR-CAFTA 
     countries will be increased only slightly as a percentage of 
     consumption under the trade agreement, [ITC, 2004.] and 
     prohibitive tariffs on over-quota imports will remain intact 
     under the DR-CAFTA. [ITC, 2004.]
       In 2003, the DR-CAFTA countries exported to the United 
     States 325,146 metric tons of sugar--most of which was raw 
     cane sugar--at a value of $141.3 million. [ITC, 2004.] These 
     imports constituted approximately 3 percent of sugar consumed 
     in the United States during that year. [ ITC, 2004.] 
     Additional increased access during the first year of the 
     trade agreement will total 109,000 metric tons. [ITC, 2004.] 
     That increase is equivalent to little more than one day's 
     production of sugar in the United States, [USTR, ``DR-CAFTA 
     Policy Brief, Sugar: A Spoonful a Week,'' February 2005.] or 
     about 1.2 percent of current annual U.S. sugar consumption. 
     [USTR, ``DR-CAFTA Policy Brief, Sugar: A Spoonful a Week,'' 
     February 2005.]
       By the end of the 15-year phase-in period, sugar imports 
     from this agreement will have increased by a total of 153,140 
     metric tons. [ITC, 2004.] The additional access during the 
     entire 15-year phase-in period represents less than 2 percent 
     of the approximately 7.8 million metric tons of sugar 
     produced in the United States in the 2003/2004 growing 
     season. [USTR, ``DR-CAFTA Policy Brief, Sugar: A Spoonful a 
     Week,'' February 2005.] Again, what the trade agreement 
     permits is an increase in import competition of less than 2 
     percent relative to domestic production--stretched out over a 
     15-year period. Following the phase-in period, the TRQs will 
     grow by an additional 2,640 metric tons each year. [ITC, 
     2004.]
       The potential impact of these increases in the in-quota 
     TRQs for DR-CAFTA countries appears minimal. USTR has found 
     that approval of DR-CAFTA ``would not have a destabilizing 
     effect on the U.S. sugar program.'' [USTR, ``DR-CAFTA Policy 
     Brief, Sugar: A Spoonful a Week,'' February 2005.] And the 
     ITC, using its models, found that there would likely be a 
     decrease in the U.S. price of sugar ``of about one percent as 
     a result of the increase in imports under the FTA.'' [ITC, 
     2004.] Clearly this suggests a negligible impact on U.S. 
     producers. Furthermore, one could argue that such declines in 
     consumer prices could boost demand and actually increase U.S. 
     producers' revenue.
       Moreover, additional TRQ access for the DR-CAFTA countries 
     is conditioned on each country's trade-surplus position. 
     [ITC, 2004.] Specifically, only net-surplus-exporting 
     countries in the region will obtain increased access to the 
     U.S. market. This is because the agreement limits access to 
     the lesser of the amount of each country's net trade surplus 
     in sugar or the specified amounts provided in each country's 
     TRQ. [ USTR, ``DR-CAFTA Policy Brief, Sugar: A Spoonful a 
     Week,'' February 2005.] For example, at the present time the 
     Dominican Republic--currently the largest TRQ holder among 
     the DR-CAFTA countries--would not qualify for increased 
     market access to ship additional sugar to the United States 
     under the agreement. [Inside U.S. Trade, ``USTR Threatens 
     Dominican Republic Over Proposed HFCS Soft Drink Tax,'' 
     September 3, 2004.] As noted by the American Farm Bureau 
     Federation (Farm Bureau), this situation makes the issue of 
     increased sugar imports from the Dominican Republic moot for 
     now. [American Farm Bureau Federation, ``Implications of a 
     Central American Free Trade Agreement on U.S. Agriculture.''] 
     According to Farm Bureau calculations, even if the Dominican 
     Republic were to become a net exporter of sugar by 2024--the 
     year in which the agreement would be fully operational--its 
     exports of sugar would increase by only $11.7 million from 
     the Dominican Republic's current allocation of $96.3 million.
       Still, some critics of the DR-CAFTA assert a second 
     argument--that increased sugar imports under the agreement 
     would have a destabilizing impact on U.S. domestic sugar 
     policies by suspension of sugar marketing allotments. [ITC, 
     2004.] Under marketing allotments, the U.S. Department of 
     Agriculture restricts the amount of sugar that can be sold by 
     domestic producers, [ITC, 2004.] a policy designed to ensure 
     stable sugar prices and supplies in the U.S. market. 
     [American Sugar Alliance, U.S. Sugar Policy Under the Farm 
     Bill, retrieved on 03/15/05.] Under the policy, if U.S. 
     imports of sugar were to exceed a specified amount 
     (approximately 1.5 million tons in a given year) marketing 
     allotments could be suspended, thus enabling U.S. producers 
     to compete with imported sugar under prevailing market 
     conditions. [ITC, 2004.]
       A cushion exists, however, between the ``trigger level'' of 
     imports that would suspend marketing allotments and projected 
     imports under the DR-CAFTA. [ITC, 2004; USTR, ``DR-CAFTA 
     Policy Brief, Sugar: A Spoonful a Week,'' February 2005.] The 
     U.S. International Trade Commission estimates that it would 
     take about 60 years following the agreement's implementation 
     for this cushion to be exceeded, taking into account growth 
     in imports during the phase-in period and subsequent annual 
     imports of 2,640 metric tons under the agreement. [ITC, 
     2004.] In 60 years, it is unknown whether marketing 
     allotments would even be a part of U.S. sugar policy. In any 
     case, the ITC believes it unlikely that increased imports 
     resulting from the agreement will trigger the suspension of 
     marketing allotments. [ITC, 2004.]
       Furthermore, in the unlikely event that U.S. domestic sugar 
     policies were threatened

[[Page 15092]]

     by imports from the DR-CAFTA countries, the agreement 
     includes a mechanism that will permit the United States to 
     restrict sugar imports from these countries and provide them 
     with equivalent benefits to compensate for lost market 
     access. [USTR, ``DR-CAFTA Policy Brief, Sugar: A Spoonful a 
     Week,'' February 2005.] This compensation mechanism further 
     alleviates possible pressures that might threaten U.S. sugar 
     policies.


                                Textile

       Some textile producers argue that passage of DR-CAFTA will 
     lead to textile job losses in the United States. [American 
     Manufacturing Trade Action Council, ``CAFTA Bad for U.S. 
     Textile Industry and Workers,'' May 28, 2004.] Additionally 
     some of the same critics have argued that the U.S. textile 
     sector is currently restructuring in response to China's 
     growth in this economic sector and, therefore, American 
     companies cannot allow additional jobs to be lost to Central 
     American textile factories. [New York Times, ``Chinese 
     Textile Flood?'' March 10, 2005.] Both arguments fail to 
     grasp the long-term benefits of regional integration to the 
     U.S. textile and apparel industry of promoting regional 
     integration under the agreement.
       DR-CAFTA will benefit the U.S. textile and apparel industry 
     by expanding the benefits currently provided by the Caribbean 
     Basin Trade Partnership Act (CBTPA) and making the benefits 
     reciprocal. The CBTPA (which includes all DR-CAFTA countries) 
     allows apparel exports from the region to enter the United 
     States duty-free and quota-free, provided that they use U.S. 
     yarn and fabric. This supports U.S. exports and jobs. Indeed, 
     in the past four years, the region has become one of the 
     largest and fastest-growing export markets for U.S. cotton 
     growers, yarn spinners, and fabric mills. Regional producers 
     face new competition from Asian imports since global quotas 
     on textiles and apparel ended January 2005. This agreement 
     will give the region a critical advantage in competing with 
     Asia in a post textile-quota world by helping to retain 
     textile production in the region, rather than moving 
     production to China. [John T. Hyatt, ``Good for Central 
     America, Good for U.S.,'' Times-Picayune, March 15, 2005.]
       When facilities move from Central America to China, they 
     are much less likely to buy U.S. yarns and fabrics. Thus, the 
     competitiveness of the U.S. fiber and yarn industry is 
     inextricably linked to maintaining the competitiveness of the 
     DR-CAFTA region. [Cass Ballenger, ``Producing for N.C.'s 
     Textiles,'' The News and Observer, March 1, 2005.] Currently, 
     71 percent of DR-CAFTA-made apparel enters the United States 
     using U.S. yarns and fabrics, while one tenth of 1 percent of 
     apparel from China enters the United States using U.S. yarn 
     or fabric. [Statistical data provided by the Office of 
     Textiles and Apparel in the International Trade 
     Administration at the U.S. Department of Commerce.] More than 
     $2.6 billion of U.S. fabric and yarn exports went to the six 
     DR-CAFTA nations in 2004. [Jeffrey Sparshott, ``A Tough 
     Sell,'' Washington Times, March 10, 2005.] By keeping apparel 
     assembly in the region through DR-CAFTA, we will retain and 
     grow the market for U.S. exports of fabrics.
       The agreement also contains tough custom enforcement 
     procedures to ensure that only products eligible for DR-CAFTA 
     tariff treatment benefit from the agreement. Further, the 
     agreement contains a special textile safeguard, which 
     authorizes the imposition of tariffs on textiles when injury 
     occurs due to import surges.
       Many of those who oppose the agreement are weavers, who 
     point to a tariff preference level (TPL) for Nicaragua that 
     extends duty-free treatment for 10 years for cotton and 
     manmade-fiber apparel made in Nicaragua from fabrics made 
     anywhere else (otherwise known as ``non-originating 
     fabric''). In other words, the fabrics do not have to come 
     from either the United States or other DR-CAFTA countries for 
     the apparel to be eligible under the TPL. The TPL was 
     included only for this one country because Nicaragua is by 
     far the smallest and least-developed apparel supplier among 
     the DR-CAFTA countries. However, TPLs have been in every 
     trade agreement negotiated before the DR-CAFTA (excluding 
     Israel and Jordan). Indeed, DR-CAFTA does not include TPLs 
     for the major Central American apparel producers--the first 
     time that a trade agreement did not provide TPLs to our 
     negotiating partners. The TPL granted to Nicaragua would 
     cover only about 3 percent of the total amount of garments 
     shipped by all CAFTA countries.
       Costa Rica is the beneficiary of a small concession for 
     wool fabric, allowing Costa Rica to source non-originating 
     fabric up to capped amount. This concession will be phased 
     out over two years, and was put in place to allow a wool 
     apparel producer to coordinate with suppliers in the United 
     States who are planning to be a source for the fabric in the 
     future (the concession is subject to review after 18 months). 
     [For more details on the textile provisions of DR-CAFTA, see 
     the February 2005 USTR policy brief, ``Textiles of CAFTA--
     Details of the Agreement.'']
       The agreement also contains tough custom enforcement 
     procedures to ensure that only products eligible for DR-CAFTA 
     tariff treatment benefit from the agreement. Further, the 
     agreement contains a special textile safeguard, which 
     authorizes the imposition of tariffs on textiles when injury 
     occurs due to import surges. Many in the U.S. textile 
     industry (retailers, yarn spinners, knitters, and apparel 
     producers) support passage of DR-CAFTA, such as Burlington 
     Industries, the American Apparel and Footwear Association, 
     Levi Strauss and Company, ERICO, International Textile Group, 
     Union Apparel, Sara Lee, and Warnaco.


                                 Labor

       Organized American labor groups oppose this free trade 
     agreement, alleging that it does not include adequate 
     provisions for workers' rights. [Statement by AFL-CIO 
     President John Sweeney on Central American Free Trade 
     Agreement, May 28, 2004.] It should be noted that the AFL-
     CIO, a leading labor union opposed to DR-CAFTA, has never 
     supported a free trade agreement, including the U.S.-
     Australia Free Trade Agreement. Further, Costa Rica, 
     Guatemala, Honduras, Nicaragua, and the Dominican Republic 
     have ratified all eight International Labor Organization 
     (ILO) core labor conventions, and El Salvador has ratified 
     six of the eight. In contrast, the United States has ratified 
     only two ILO core conventions.
       An analysis by the ILO demonstrates that the labor laws and 
     constitutions of the DR-CAFTA countries are comparable to ILO 
     core labor standards. [USTR, ``CAFTA Facts: The Facts About 
     DR-CAFTA's Labor Provisions,'' February 2005.] The problem 
     has been, however, that the governments have lacked the 
     capacity to enforce their labor laws due to financial 
     constraints. To address this, the United States is taking a 
     three-pronged approach in DR-CAFTA: First, each country must 
     enforce its own labor laws. If they do not, then a fine will 
     be imposed and the monies from the fine will be used to 
     address the enforcement deficiency. [USTR, ``CAFTA Facts: The 
     Facts About DR-CAFTA's Labor Provisions,'' February 2005.] 
     Second, each country must make the necessary economic and 
     legal reforms to improve ILO adherence. Third, each country 
     must undertake capacity building to enforce its domestic 
     labor laws. To accomplish this, the United States is offering 
     capacity-building assistance to improve labor law 
     enforcement. As a first step, Congress appropriated $20 
     million in the FY05 Foreign Operations appropriations bill 
     specifically to help build the capacity of Central America 
     and the Dominican Republic on labor and environmental law 
     enforcement. [Rep. Jim Kolbe (R-AZ) authored a provision in 
     the FY05 Foreign Operations Appropriations bill that provided 
     $20 million to assist CAFTA countries with labor standards 
     enforcement.]
       Ironically, while the AFL-CIO opposes DR-CAFTA because the 
     agreement doesn't overtly include ILO standards, the 
     conditions in the agreement pertaining to the enforcement of 
     standards for workers' rights will serve as a catalyst for 
     these countries to take labor laws seriously. Moreover, the 
     labor provisions in DR-CAFTA are the same as those contained 
     in the U.S.-Morocco Free Trade Agreement that Congress passed 
     overwhelmingly last July (by a vote of 323-99 in the House 
     and by a vote of 85-13 in the Senate).


                              Environment

       The DR-CAFTA environmental provisions promote policies that 
     ensure protection of current laws while striving to improve 
     those laws, with effective remedies for violating the 
     agreement. This type of environmental protection goes beyond 
     the requirements called for in the Trade Promotion Act (2002) 
     and recently implemented FTAs with Chile and Singapore. The 
     agreement has taken groundbreaking steps to mitigate 
     environmental degradation by involving all stakeholders 
     through meaningful public participation and capacity building 
     for the region. There is wide appeal for the environment 
     provisions because of these new initiatives and it is 
     demonstrated by the support it has received from local 
     environmental conservation NGOs from five of the six DR-CAFTA 
     countries. [Letter to Ambassador Zoellick from 10 NGO's dated 
     January 31, 2005.]
       Failure to pass the agreement will only serve to undermine 
     these important initiatives to strengthen environmental 
     protection in the region.


                  Broad American Support for DR-CAFTA

       Since last year, scores of organizations, associations, and 
     businesses have made known their support for passage of DR-
     CAFTA. Perhaps one of the most compelling, detailed, and 
     broadly supported endorsements was issued on January 26, 2005 
     by the Business Coalition for U.S.-Central America Free 
     Trade. In a letter to Senate Majority Leader Bill Frist, the 
     Business Coalition listed five reasons why the ``timely 
     implementation'' of DR-CAFTA was important, citing commercial 
     importance (``over the last five years, the [DR-CAFTA] 
     countries have been our fifth largest growth market 
     worldwide''); reciprocity in U.S.-Central American trade 
     relations and creation of new opportunities for all sectors 
     of the U.S. economy; strengthening of democracy and rule of 
     law ``in a region that was wracked by civil war not that long 
     ago;'' critical importance of maintaining and fostering ``key 
     partnerships in the textile and apparel sector;'' and the 
     signal that would be sent to ``all of the United States'' 
     trading partners that the United States remains committed to 
     trade and investment liberalization at an important

[[Page 15093]]

     juncture in WTO negotiations.'' [A letter to Senator Bill 
     Frist (R-TN), dated January 26, 2005 by the Business 
     Coalition for U.S.-Central America Trade.]
       The letter was signed by the representatives of more than 
     100 organizations, associations, and companies, including 
     Pepsi, Boeing, American International Group, Warnaco, the 
     American Farm Bureau Federation, Caterpillar, Exxon Mobil, 
     Grocery Manufacturers of America, JC Penney, Microsoft, Mars 
     Incorporated, National Cattlemen's Beef Association, National 
     Pork Producers Council, Procter and Gamble, Time Warner, and 
     the U.S. Chamber of Commerce.
       President Clinton's former senior Treasury and trade 
     official, Stuart Eizenstat, has strongly argued that DR-CAFTA 
     is a must-pass agreement. Writing in the Wall Street Journal 
     earlier this month, Eizenstat stated, ``The agreement is 
     deeply in our national interest and will create, not destroy, 
     jobs.'' [Stuart E. Eizenstat, ``Trade Wins,'' Wall Street 
     Journal, March 8, 2005.] He went on to remark that ``the 
     agreement would solidify the United States as the leading 
     supplier of goods and services to Central American and the 
     Dominican Republic at a time when China is making serious 
     inroads as an investor and exporter in the Western 
     Hemisphere.'' [Eizenstat.]

                   Consequences Should DR-CAFTA Fail

       The economic and social consequences of failing to pass the 
     DR-CAFTA would be significant. Economically, U.S. exporters 
     would continue to face high tariff barriers on their exports 
     to the region. Furthermore, U.S. service providers would 
     continue to face numerous non-tariff barriers to their 
     service exports.
       Thousands of apparel production jobs in Central America and 
     the Dominican Republic would be lost as investors move 
     production facilities to China. As a result, numerous U.S. 
     suppliers of cotton, yarns, fabrics and other components 
     would lose an important export market--America's third 
     largest--for their products as Chinese facilities will likely 
     source their needed components from Asia instead of the 
     United States. [USTR, CAFTA Policy Brief, ``Textiles of 
     CAFTA--Details of the Agreement,'' February 2005.] Further 
     economic consequences could also include increased 
     immigration from the Dominican Republic and Central America 
     as displaced workers seek opportunity abroad.
       Politically, failure to pass DR-CAFTA would be seen by our 
     Central American partners as American disengagement from a 
     strategically important region of the world. It would send a 
     signal to our other trading partners that our nation is not 
     committed to the principles of open markets and, thus, 
     discourage them from making market access and other economic 
     commitments that are vitally important to our nation as we 
     negotiate in the Middle East, Asia, Europe, or other areas in 
     the Western Hemisphere. Furthermore, failure to pass DR-CAFTA 
     would have a chilling effect on the Doha Development Agenda 
     of trade negotiations at the World Trade Organization, 
     potentially jeopardizing our most significant opportunities 
     to gain broad access for our agriculture, manufacturing, and 
     services exports.


                               Conclusion

       DR-CAFTA is the latest in a series of successfully 
     negotiated, far-reaching, economically-beneficial trade 
     agreements undertaken by the Bush Administration. DR-CAFTA is 
     the first trade agreement since the U.S.-Chile Free Trade 
     Agreement was passed in 2003 that includes economies in 
     America's geographic backyard. Most importantly, DR-CAFTA is 
     a great economic package for both the nations of Central 
     America and the United States. The agreement will provide new 
     economic opportunities for American investors and secure 
     American and Central American jobs.
       DR-CAFTA is as much a political statement as it is an 
     economic one. As Senator Charles Grassley (R-IA) has noted: 
     [DR-CAFTA] shows our strong desire to reach out and form 
     deeper and lasting bonds with the international community, 
     particularly in Latin America. The agreement will help to 
     lock in economic reform and increase transparency in the 
     region. DR-CAFTA can serve as a cornerstone of economic 
     growth and democracy for the region which will enhance the 
     standard of living for millions of our southern neighbors. 
     [Senator Charles Grassley (R-IA), Congressional Record, July 
     22, 2004.]
       Congress should pass DR-CAFTA. It is in our national 
     economic, political, and security interests to do so.

  Mr. CRAIG. Mr. President, I rise today to discuss the Central America 
Free Trade Agreement, its importance to our country, to our economic 
interests both here and at home, and around the world.
  Since Congress gave the President fast-track trade negotiating 
authority in August of 2002, we've had to face the realities that come 
with it.
  I supported giving the President fast-track authority then, with the 
caveat that I would approach all trade agreements sent to Congress with 
an open mind.
  Three agreements have reached Congress since 2002 and I have voted 
for two of those three.
  The administration has been actively pursuing a vigorous bilateral 
and free-trade agenda around the world, and I believe it is in our best 
interest to do so both economically and socially.
  Trade with foreign nations is a valuable component to promote 
economic opportunities here at home, but also to spread our democratic 
ideals that we value so highly in our country.
  Congress is now debating the Central American Free Trade Agreement, 
otherwise known as CAFTA. I became heavily involved with our trade 
negotiators as the President and our then-Trade Representative Bob 
Zoellick began negotiations with the CAFTA nations.
  As an agricultural State, Idaho has a large stake in these agreements 
and agriculture right now is currently learning how to restructure 
itself as our global markets become highly integrated.
  As many know, a major agricultural crop in my State is the production 
of sugar. Idaho is the second-largest producer of sugarbeets behind 
Minnesota.
  Idaho's sugar industry employs somewhere in the neighborhood of 7 to 
8,000 people and generates nearly $800 million in economic activity for 
the State economy.
  The sugar industry in Idaho, and in most other sugar-producing 
States, has restructured itself after several years of unprofitability. 
Farmers pooled their money to create cooperative processing plants to 
market their sugar and so inherently have a large personal investment 
in all levels of production.
  It's well known that the world sugar market is one of the most 
distorted agricultural markets in the world, and most world sugar 
supplies are simply dumped on the market at prices well below the cost 
of production.
  U.S. producers already face an oversupply situation with significant 
quantities in storage at the expense of producers. Prices have slowly 
declined, yet production costs have sky-rocketed.
  Although the U.S. is the 4th largest importer of sugar in the world, 
CAFTA seeks to significantly compound an already ugly situation and set 
a precedent of ``no return'' for further negotiations already underway 
with major sugar-exporting countries like Thailand and Panama.
  CAFTA nations already enjoy duty-free quota access for sugar with the 
U.S., and I am not prepared to trade away an industry so vital to my 
State and to the overall farm economy in Idaho.
  Other Idaho agricultural groups understand that those farmers who are 
sugar producers are also potato, bean, and grain producers. We're not 
just talking about impacting one commodity, we are cutting a wide swath 
across several industries and sending an economic ripple through our 
rural communities that may not be recoverable.
  Our U.S. negotiators are willing to open our markets to increased 
sugar imports, while our competitors maintain unfair economic 
advantages in domestic subsidies and minimal market access commitments.
  Myself along with my colleagues from sugar-producing States took our 
concerns with CAFTA to the administration. With the help of my good 
friend and Chairman of the Agriculture Committee, Senator Chambliss, we 
spent some late nights and several conference calls to come up with a 
solution that would allow could address the concerns of the sugar 
industry.
  Our new U.S. Trade Representative Rob Portman and U.S. Department of 
Agriculture Secretary Mike Johanns joined us in trying to iron out the 
differences and find some mutually agreeable options. I am very 
impressed with these two men's willingness to roll up their sleeves and 
work with me and others on what has been a very difficult issue.
  Although these discussions should have occurred much earlier, the 
administration came a very long way in a short amount of time to reach 
a resolution.

[[Page 15094]]

  A proposal was offered to maintain the sugar program as passed in the 
2002 Farm Bill and to provide the industry with relief from surges of 
imported, cheap foreign sugar by studying and beginning to establish a 
sugar-to-ethanol program in the U.S.
  I think this proposal represents a strong effort of compromise in a 
complex and difficult environment. I would like to praise Secretary 
Johanns and Ambassador Portman for their willingness to make this 
quantum leap to accommodate our concerns. I think the proposal brings 
some good ideas to the table that we can build upon.
  I understand that Secretary Johanns has sent the proposal in writing 
to Congress to affirm his commitment to the agreement. I will be 
working with Chairman Chambliss on a Sense of the Senate to solidify 
this proposal and strengthen the promise made to the industry.
  The only fault of this proposal is that it does not provide the long-
term solution that the industry desperately needs. I also have major 
concerns that the proposal compromises the law by changing our sugar 
program from that of operating at ``no-cost'' to the taxpayer to one 
that could cost hundreds of millions of dollars. This is just not 
sustainable and a major departure from our promise to the industry.
  I know I share the same strong concerns with Chairman Chambliss that 
free trade agreements should remain faithful to current U.S. policy and 
not restrict options available to Congress in future farm bills.
  For these reasons, I will be voting against CAFTA. However, I do 
applaud the administration for their diligence and willingness to work 
with me on this issue. I hope that as we near the next Farm Bill in 
2007, we will continue to work on a sustainable answer that maintains a 
very important industry in my State but also the agricultural economy 
in the U.S.
  Mr. LEVIN. Mr. President, our trade policy is failing. This failure 
is reflected in a trade deficit that grew by 25 percent last year to 
more than $617 billion, and in the loss of 2.8 million manufacturing 
jobs over the past 4 years. We are in this predicament in part because 
we have pursued one-way trade agreements that are not in the best 
interest of the United States and because we have not insisted that our 
trading partners grant us true reciprocity.
  It is difficult to see how pursuing yet another trade agreement in 
the same failed mold will produce a different result. The Central 
America Free Trade Agreement will not benefit American workers and 
farmers because it fails to insist on basic internationally recognized 
labor standards, the agreement will not meet its promise to improve the 
standard of living for the people of Central America and the Dominican 
Republic; Instead, it will set off another race to the bottom.
  The administration is asking the Senate to rubberstamp implementing 
legislation for CAFTA under fast-track procedures that only allow 
Members of Congress an up-or-down vote and no chance to amend or 
improve it. Although I support increased trade with Central America and 
believe that fair trade policies would benefit all parties, I do not 
support the agreement as crafted. Without the chance to improve it, I 
must oppose it.
  The administration is not doing the work necessary to get our trade 
policy on track. The five Central American countries and the Dominican 
Republic account for less than 1.5 percent of total U.S. trade, and our 
own International Trade Commission found that the U.S. trade deficit 
with CAFTA countries would likely increase slightly as a result of 
CAFTA. Yet the administration has made CAFTA its No. 1 trade priority. 
A better focus for our trade policy would be opening markets in Nations 
and sectors where the most egregious trade barriers block the sale of 
U.S. goods and services. We should break down barriers faced by U.S. 
manufacturers, farmers and services in key export markets including 
China, Japan, the EU, Korea, and elsewhere.
  This administration has also failed to deal with our trade deficit 
with China, which is on track to surpass $200 billion this year. The 
administration has failed to take action against China for undervaluing 
its currency by between 15-50 percent relative to the dollar to promote 
exports to the United States and to keep out goods made in the United 
States. This is a violation of the WTO prohibition on gaining a trade 
advantage from currency manipulation. The administration has also 
failed to deal with our large and persistent automotive deficit with 
Japan.
  Likewise, our recent record on trade agreements has not been strong; 
some of the trade agreements the U.S. has entered into have not been in 
the best interest of the United States. The clearest example is NAFTA, 
which made it easier for U.S. companies to outsource production to low-
wage countries. Between NAFTA's enactment in 1994 and the end of 2003, 
the Department of Labor certified that more than 525,000 American 
workers suffered job losses as a result of increased imports or plant 
relocations to Mexico and Canada. Under NAFTA, our trade balance with 
Mexico went from a surplus of $1.663 billion in 1993 to a deficit of 
$45 billion in 2004. While it is true that our exports to Mexico 
increased under NAFTA, our imports from Mexico also increased, and at a 
faster rate.
  The American people and Members of Congress are understandably 
frustrated by the failure of NAFTA, and they are equally skeptical 
about the need to enter into another trade agreement pitting low wage 
workers from countries with weak labor and environmental laws against 
U.S. workers. Trade should not be a race to the bottom in which U.S. 
workers must compete with countries that do not recognize core 
international labor standards and basic worker rights, but that is 
exactly what CAFTA would do.
  I am disappointed by the weak labor and environmental provisions 
included in CAFTA. Writing labor and environmental standards into trade 
agreements is an important way to ensure that free trade is fair trade. 
But unlike the 2001 Jordan Free Trade Agreement, CAFTA fails to include 
internationally recognized, core labor standards. Those standards 
include the right to organize/associate; the right to bargain 
collectively; a prohibition on child labor; a prohibition on 
discrimination in employment; and a prohibition on forced labor. I am 
not seeking that CAFTA countries commit to American standards but at 
least to the five basic international standards developed by the ILO 
and supported by virtually every country in the world.
  Indeed, the DR-CAFTA countries are signatories of the International 
Labor Organization conventions. Requiring them to abide by their own 
international obligations is the least we can do when considering 
whether they deserve to receive trade preferences from us. But CAFTA 
only requires member countries to enforce their own labor and 
environmental laws, however inadequate they may be.
  Unlike the Jordan FTA, the CAFTA labor provisions are not 
enforceable. The U.S.-Jordan FTA treats the labor and environmental 
commitments the same as the commercial commitments, enforceable under 
the agreement's dispute settlement procedures. Under CAFTA, however, 
the labor provisions are not subject to the same binding dispute 
settlement mechanisms as are the commercial provisions, and violations 
cannot lead to the same level of fines or sanctions. There is a much 
lower standard for labor and environmental commitments, and that makes 
this a flawed agreement. Under CAFTA, the only labor rights and 
environment provision that is enforceable through dispute settlement 
mechanisms is if a party fails to enforce its own labor or environment 
laws effectively.
  This is of significant concern because CAFTA nations' own labor laws 
do not meet international standards. In fact, these countries have 
histories of serious worker rights abuses. The 2004 U.S. State 
Department Country Reports on Human Rights Practices; the October 2003 
ILO Fundamental Principles and Rights at Work'' A Labor law Study, and 
other ILO reports confirm at least 20 areas in which the labor laws in 
the CAFTA countries fail to comply with the right of association, ILO 
Convention 87, and the right to organize and

[[Page 15095]]

bargain collectively, ILO Convention 98.
  To give just a few examples, in El Salvador and Nicaragua it is legal 
to fire workers simply because they are union members; Human Rights 
Watch found that the use of child labor in El Salvador's sugar cane 
fields is widespread; and under Honduran law, it is legal to fire 
workers who say they intend to organize a union. One company in the 
Dominican Republic fired 140 workers at once because they sought a 
collective bargaining agreement. The company was fined $660, or about 
$5 per worker.
  Our own Department of Labor and State Department reports show that 
CAFTA countries fail to provide their workers internationally 
recognized rights. The U.S. State Department's 2002 Human Rights report 
on Guatemala said:

       Retaliation, including firing, intimidation, and sometimes 
     violence, by employers and others against workers who try to 
     exercise internationally recognized labor rights is common 
     and usually goes unsanctioned.

  The U.S. State Department's 2002 Human Rights report on El Salvador 
said:

       There were repeated complaints by workers, in some cases 
     supported by the ILO Committee on Freedom of Association 
     (CFA), teat the Government impeded workers from exercising 
     their right of association. In June 2001, the CFA reiterated 
     its 1999 finding that the existing labor code restricts 
     freedom of association.

  That same report also said of El Salvador:

       The constitution prohibits the employment of children under 
     the age of 14; however, child labor is a problem.

  CAFTA would give away the current leverage we have against these 
violations of basic workers rights. Under CAFTA, the U.S. can only take 
action against a country if it deliberately fails to enforce its labor 
and environmental laws in an effort to gain a trade advantage. Even 
then, the country must only pay a fine to itself, which will be used to 
fund labor enforcement in that country. This is a step backwards from 
the status quo.
  CAFTA countries currently have preferred access to our markets 
through the Caribbean Basin Initiative, CBI, and the Generalized System 
of Preferences, GSP. Under these trade preference programs, beneficiary 
countries must meet internationally recognized labor standards or risk 
losing their preferential trade treatment. These current trade 
preferences can be completely withdrawn for failure to meet ILO core 
labor standards. The possibility of losing trade benefits works as a 
strong incentive for CAFTA countries to make improvements in their 
worker rights laws. CAFTA eliminates that incentive because it gives 
CAFTA countries permanent trade benefits regardless of how they treat 
their workers and no matter how far their labor laws fall short of 
international norms.
  If we give away that leverage, CAFTA countries would have no 
incentive to improve their inadequate labor laws or the treatment of 
their workers. If a country wants to have preferential access to the 
U.S. market through a trade agreement or preferential trade benefit 
program, it ought to agree to abide by the ILO labor standards. Without 
such a commitment, we might be giving special access to our markets to 
products made with child labor or forced labor, or to employers that 
intimidate or use violence against workers attempting to organize or 
join labor unions. That is not something we as a Nation would want to 
do.
  Countries getting benefits from the U.S. should comply with 
internationally recognized labor standards as a condition for receiving 
those benefits. That is a reasonable expectation and one that is 
reflective of basic American values. Trade should not be a race to the 
bottom. And American workers should not be asked to compete with 
countries that do not recognize core international labor standards and 
basic worker rights.
  Rejecting the CAFTA implementing legislation as currently drafted is 
a rejection of the failed and flawed trade policies of the past and a 
signal of support for a better approach to trade that supports both the 
rights of American workers and the rights of our trading partners.
  Mr. JEFFORDS. Mr. President, throughout my 30 years in the Congress, 
I have considered myself a free-trader. I believe that breaking down 
barriers to trade and opening access to markets in a fair and balanced 
way in the long run benefits all economies, both consumers and 
producers. As the distance between economies shrinks, integration of 
economies in a positive way is increasingly important. The 
implementation of free-trade agreements to codify the rules of fair 
play and bind all parties to strong and enforceable labor and 
environmental protection standards are important steps in the 
development of a more broadly beneficial and less biased world trading 
system.
  In the case of our nearest neighbors, trade agreements take on a 
security component as well. I believe a strong trade agreement can help 
break the cycles of poverty, deprivation and marginalization currently 
operating in many of the Central American countries. We know the 
economic status quo is unjust and dangerous. Many people in the region 
feel they have little hope of earning a good living or providing a good 
education for their children. That must change. It is in the United 
States' economic and security interest that positive change occurs.
  Throughout the Dominican Republic--Central America--U.S. Free Trade 
Agreement, CAFTA, negotiation process, I joined a number of my 
colleagues on the Finance Committee in urging President Bush and the 
U.S. Trade Representative to address concerns about the labor and 
environment standards and enforcement mechanisms in this agreement. I 
indicated my deep concern that historically, in most of these 
countries, economic benefits are not shared by all strata of society. 
When negotiating trade agreements between economies of such unequal 
scale, these concerns are of particular importance. I am disappointed 
the administration did not do more to advance these causes in this 
agreement. Some progress was made, but more could have been 
accomplished if our recommendations had been adopted in full.
  I have heard from a great many points of view as this agreement has 
firmed up and the implementing legislation came before Congress. I have 
heard from many Vermonters who are opposed to increased trade in 
general and this agreement in particular. On the other hand, Vermont 
dairy farmers have come to me in support of CAFTA. Dairy industry 
experts predict that the ratification of this agreement will increase 
the sales of American dairy products to Central America by $100 million 
over the next several years--not a huge amount, but a significant one, 
given the economics of our dairy industry. As an important dairy State 
offering a number of high-quality cheeses and specialty products, 
Vermont stands to gain from this agreement. The agreement will create 
opportunities for other Vermont exporters as well, particularly small, 
niche businesses for which Vermont is famous. As with dairy sales, I 
don't expect these opportunities will be voluminous, but every bit 
helps in a global economy.
  I have heard very diverse viewpoints from the Central American 
countries as well. The region's historic inability to spread economic 
gains to all sectors of society is of deep concern to many in the 
region, and I share this concern. For two decades, I have been involved 
in the struggle to end human rights violations and labor rights abuses 
in many of these countries. While CAFTA extracts important promises 
from Central American Governments to abide by international standards 
of human rights and labor rights, my experience leaves me very 
skeptical of these commitments. Furthermore, the economic deprivation 
of much of the region frustrates all but the most committed efforts at 
reform. Current trends are leading to greater disparity between the 
rich and the poor, urban areas versus rural areas, and economically 
connected versus economically marginalized populations. These trends 
must be reversed--not just for the health of the region, but also for 
our own economic health and national security.

[[Page 15096]]

  The key question is whether CAFTA will exacerbate these trends, or 
whether it can help reverse them. Many in the region fear the United 
States will move in to benefit from markets in the region while 
frustrating Central American efforts to access U.S. markets. I have 
also heard from Central Americans who believe the reduction of tariffs 
and the standardization of commerce will greatly enhance their ability 
to sell to the U.S. market, thereby benefiting communities, often 
marginal ones, in Central America.
  After hearing diverse points of view, I concluded that without 
significant support from the United States to assist in the enforcement 
of labor agreements and development of greater capacity for balanced 
economic growth, I could not support CAFTA. Over the past few weeks, I 
have joined several of my colleagues in pushing the administration to 
commit to greater support for foreign assistance to the region, aimed 
specifically at the most vulnerable sectors of Central American society 
and the need for a strong international presence to monitor labor 
rights compliance. While we requested greater levels of aid, our 
negotiations produced a commitment from the White House to budget for 
and support $40 million in labor and environment capacity building 
assistance for the next 4 years. Additionally the administration has 
agreed to increase funding to the International Labor Organization, 
ILO, by $3 million annually for on the ground monitoring of each 
country's labor rights commitments and actual labor practices. This 
could potentially produce the first significant step forward in broad 
enforcement of labor standards throughout the region.
  In response to our concerns, the administration has also agreed to 
provide, through the Inter-American Development Bank, $30 million 
annually to El Salvador, Guatemala and the Dominican Republic, $10 
million to each country, for rural development and institution building 
for a period of 5 years. This commitment of $150 million for rural 
development assistance to the region is very significant. We have asked 
that these funds be targeted most directly to the poorer sectors of 
these economies, particularly those most likely to suffer adverse 
effects from CAFTA. The administration had previously announced 
agreements to provide Honduras and Nicaragua with U.S. foreign 
assistance through the Millennium Challenge Corporation, MCC, at $215 
million and $175 million, respectively. In the course of recent 
discussions, the administration has agreed to give higher priority to 
the development of MCC compacts with El Salvador, Guatemala, and the 
Dominican Republic as well.
  While I still have concerns about CAFTA's effect upon Central 
America, I believe the commitments we have received from the Bush 
administration on foreign aid, labor rights and the environment 
represent a significant step forward in the ability of the region to 
reverse current trends and improve regional standards of living. I am 
hopeful these steps will lead to the improvement of the region's vital 
institutions and help ensure that the benefits of the agreement will 
trickle down to all members of society. The proof will be in the 
implementation, which I plan to follow very closely. However, I am 
heartened that we now have more to work with, and we are assured of 
greater support from the administration for this process. Based on the 
strength of these assurances, I will support the CAFTA agreement.
  Mr. HATCH. Over the years, I have been a strong advocate for free 
trade. Free trade is important. I know of no other endeavor that 
affords us the opportunity to forge closer links between nations while 
simultaneously improving the lives of millions.
  The vast majority of economists agree that free trade is in every 
nation's long-term best interests. Diplomats also know that it is far 
easier to reach a compromise between nations whose economies are 
mutually reliant. That being said, there are certain aspects of free 
trade that cause me concern. We need to be ever vigilant to ensure our 
approach to free trade does not relinquish our sovereign rights as a 
nation.
  Over the last few years, I have heard from many Utahns who are 
concerned that the U.S. is relinquishing sovereignty to other countries 
through our trade agreements. Let me make clear that we absolutely 
cannot give up our right to govern within our own borders. We have laws 
for a reason and they represent the ideals and values we hold dear in 
our society.
  Constituents contact me on a constant basis to underscore their 
frustration with the gradual loss of sovereignty the U.S. is 
experiencing in international arenas. Local lawmakers from across the 
country are reaching out to us and asking for our help in ensuring 
their local laws and authority remain intact as we enter into 
international trade agreements. Indeed, recently, the Utah State 
Legislature passed a resolution which echoes these concerns.
  The issue of maintaining sovereignty was highlighted by a recent 
World Trade Organization, WTO, dispute resolution body ruling on 
Internet gambling. The ruling stated that the United States cannot 
block other countries from offering Internet gambling to U.S. 
residents, even if they live in States such as Utah where gambling is 
illegal.
  This is outrageous.
  We absolutely cannot enter into agreements where our laws are 
overturned by outsiders. It is important for my colleagues to be aware, 
however, that the Office of the U.S. Trade Representative has 
interpreted the language in the WTO decision stating that gaming laws 
are ``necessary to protect public morals or to maintain public order'' 
to mean that ``WTO members are entitled to maintain restrictions on 
internet gaming . . . and U.S. restrictions on internet gambling can 
stand.''
  I am aware that many in Utah are concerned that CAFTA could usurp our 
State's right to regulate gambling. That is a concern I shared as well. 
However, many of us were reassured by the statements made by the Office 
of the U.S. Trade Representative that CAFTA does not jeopardize any 
existing State laws, including Utah's antigambling laws.
  We will have to stay on top of this, though. I do not intend to let 
any international agreement affect the laws our great State has enacted 
that represent the predominant moral views of our citizens.
  Other concerns with CAFTA regarding ``investor-state provisions that 
will allow corporations to challenge public interest policies at the 
state and local level'' have also been raised. Once again, however, the 
Office of the United States Trade Representative has clearly stated 
that ``nothing in CAFTA, or any other free trade agreement or bilateral 
investment treaty, interferes with a state or local government's right 
to regulate. An investor cannot enjoin regulatory action through 
arbitration, nor can arbitral tribunals.'' This statement, in black and 
white, will ensure that Internet gambling is not--and will not--become 
legal in the State of Utah without the consent of its citizens. There 
can be no ``end-run'' around the USTR's interpretation of the Internet 
gambling decision.
  Although our CAFTA trade negotiators have done much to protect our 
sovereignty, it is obvious that we must remain vigilant and ensure that 
the sovereignty of not only our Nation, but also our States, is 
maintained. I will work to maintain this sovereign right of the people.
  Mr. President, I have become convinced that many of these problems 
and concerns with U.S. trade agreements could be alleviated if we 
improved the amount and quality of consultation occurring between 
States and the Federal Government with respect to trade agreements. 
Simply put, we need to provide greater opportunities for substantive 
consultation to occur.
  This problem was the topic of a recent letter signed by 28 States 
attorneys general, including Utah, requesting greater consultation 
between the U.S. Trade Representative and the States on issues 
affecting States rights.
  I believe we need to take action on this immediately and ensure that 
we

[[Page 15097]]

provide greater access to and consultation with our States and 
citizens. We clearly are seeing how big of an impact these trade 
agreements are having in every State and city in America.
  We need to give the States a direct conduit for their input.
  Negotiators need to have this information in order to ensure we are 
representing the interests and beliefs of our constituents.
  Mr. President, these concerns have weighed heavily upon my mind. At 
the same time, I am encouraged by the many positive results CAFTA will 
have for our State, our country, and for Utah's farmers and industries. 
According to the Department of Commerce, between 2000 and 2004, Utah's 
exports to CAFTA nations increased by 58 percent. This includes such 
product areas as plastics, electronics, and instrumentation.
  In plastic products, Utah industries sold $18.6 million in goods in 
2004. In electronic and instrumentation products, Utah businesses sold 
$5.6 million worth of goods in 2004. The elimination of tariffs will 
make these products even more competitive in this developing market.
  We have reason for our optimism. While our experience with the 
Chilean Free Trade Agreement provides no guarantees, it is 
illustrative. In the first year of the U.S.-Chile Free Trade Agreement, 
Utah's exports to Chile grew by 152 percent.
  I am also pleased that CAFTA will level the playing field so that 
American goods and products can have better access to Central American 
markets. As part of our long-standing effort to support democracies in 
the region, the United States has afforded unilateral preferences to 
Central American goods under the Caribbean Basin Initiative and the 
Generalized System of Preferences. CAFTA eliminates these preferences 
while simultaneously strengthening our commercial ties by making the 
trading relationship permanent. All of this will be accomplished while 
American products will have greater opportunities for export in the 
region.
  One example of the positive attributes of CAFTA can be found in the 
agreements effect on the hard-pressed textile and yarn producing 
industries. Our nation, through the use of modern equipment and greatly 
improved efficiency, continues to be competitive in this area. Where we 
have lost ground is in the labor-intensive apparel construction 
industry.
  CAFTA provides an opportunity to help rectify this setback. Under 
current agreements, 56 percent of all textile products that are 
imported from CAFTA nations to the United States contain U.S. yarns or 
fabrics. When CAFTA is enacted, we can only expect these numbers to 
increase. This stands in marked contrast to apparel imported from 
Pacific Rim, and in particular China, where less than 1 percent of all 
of apparel imports contain U.S. yarns and fabrics. Therefore, I 
believe, that in the case of CAFTA, the pros do outweigh the cons.
  But, I will end on this note of caution. I will watch implementation 
of this agreement carefully. We need to have recognition of the fact 
that States are partners in these agreements. There must be greater 
opportunities afforded to the States to be consulted on free-trade 
agreements.
  Likewise, we must remain vigilant that our Nation's and respective 
States' sovereignty is maintained.
  On balance, Mr. President, any reasoned analysis indicates that CAFTA 
will benefit our Nation and our State. It is for this reason that I 
will cast my vote in support of the Dominican Republic-Central American 
Free Trade Agreement.
  Mrs. CLINTON. Mr. President, today the Senate votes on the Central 
American-Dominican Republic Free Trade Agreement. During my tenure as 
Senator, I have voted for every trade agreement that has come before 
the Senate and I believe that properly negotiated trade agreements can 
increase living standards and foster openness and economic development 
for all parties. When DR-CAFTA negotiations began, I was eager to 
support an agreement. It was my sincere hope that President Bush would 
send an agreement to Congress that would help address the DR-CAFTA 
nations' development challenges and spread the gains from trade more 
broadly. Unfortunately, the Bush administration has not submitted such 
an agreement, instead missing a tremendous opportunity to conclude an 
agreement that strengthens the bonds between the United States and the 
DR-CAFTA nations. While this agreement provides some benefit for New 
York, I regretfully conclude the harm outweighs the good. I must 
therefore vote to oppose.
  My vote to oppose DR-CAFTA is one taken with great difficulty. I have 
heard strong arguments both for and against from many New Yorkers who 
have a stake in the agreement and I have weighed them seriously. 
Segments of the New York economy would benefit from this agreement, but 
at the end of the day, I cannot support an agreement that fails to 
include adequate labor standards and is a step backward in the 
development of bipartisan support for international trade.
  At the outset, it is important to understand that consideration of 
DR-CAFTA is not occurring in isolation. This agreement must be read 
within the larger context of the failed economic and trade policies of 
this administration. Under this administration, the trade deficit has 
soared. The offshoring of U.S. jobs has continued to increase, and the 
U.S. economy has experienced a net loss of U.S. jobs. The 
administration has no plans to address rising health care and pension 
costs that are imposing such a tremendous burden on American 
businesses. This administration has also failed to enforce existing 
trade rules and has not been aggressive in addressing the tax and 
capital subsidies of our competitors.
  Turning to the specifics of the agreement itself, DR-CAFTA fails in 
significant respects. The most problematic elements are its labor 
provisions which retreat from advances made in the late 1990s and that 
culminated in the labor provisions of the U.S.-Jordan Free Trade 
Agreement. The U.S.-Jordan Free Trade Agreement included 
internationally recognized enforceable labor standards in the text of 
the agreement. Sadly, DR-CAFTA is a step backward. The labor provisions 
of the DR-CAFTA agreement instead used an ``enforce your own laws'' 
standard which is not included in any other area of the agreement. An 
``enforce your own laws'' standard may work in nations with a strong 
tradition of labor enforcement, but the International Labor 
Organization, ILO, has documented that the CAFTA countries' labor laws 
have not complied with international norms in at least 20 areas.
  The Jordan FTA made labor rights obligations subject to the same 
dispute settlement resolution procedure as commercial obligations. 
Conversely, DR-CAFTA includes a separate dispute settlement procedure 
for labor disagreements, which caps the damages that can be imposed for 
labor violations.
  The Chile, Australia and Singapore free trade agreements, which I 
supported, contained similar ``enforce your own law'' labor provisions 
to DR-CAFTA, but as I noted when I voted for these agreements, I was 
greatly disturbed by these provisions' departure from the labor rights 
standards negotiated in the U.S.-Jordan Free Trade Agreement. In the 
end, I supported these agreements despite these concerns because I 
believed the agreements would not harm the average working person in 
those nations and, thus, the flawed labor provisions did not outweigh 
the benefits offered by the agreements. I noted, however, that I would 
not continue to support agreements with these provisions where the 
impact was greater on workers. In the DR-CAFTA agreement, the flawed 
labor provisions represent a real missed opportunity to spread the 
benefits of trade not just to the wealthy elites, but to the broader 
workforce as well.
  There are other problems with the DR-CAFTA agreement. The final 
agreement excludes provisions for assisting U.S. workers harmed by 
trade. The environmental provisions of CAFTA undermine environmental 
protection, by including a lack of parity

[[Page 15098]]

between the enforcement of commercial and environmental provisions. 
This is a clear step back from the Jordan Free Trade Agreement. 
Finally, the environmental conservation provisions lack a commitment to 
fund their implementation.
  The agreement also fails in the area of public health. Regarding 
pharmaceuticals, I would note that in 2001, 142 countries, including 
the United States, adopted the Doha Declaration, an agreement that 
provided that trade obligations should be interpreted and implemented 
in ways that protect public health. In August 2002, Congress passed the 
Trade Promotion Authority Act which applied Doha to U.S. trade 
negotiations. Despite this commitment, the administration has promoted 
provisions within trade agreements, including DR-CAFTA, that will 
significantly impede the ability of developing countries to obtain 
access to inexpensive, life-saving medications. Contrary to the 
principles of Doha, these agreements place the interests of large 
multinational drug companies over the ability of developing countries 
to safeguard public health.
  The DR-CAFTA agreement negotiated by the President represents a 
missed opportunity in many respects, both for the DR-CAFTA nations and 
for the U.S. For the DR-CAFTA nations, it is a missed opportunity to 
ensure that the benefits of trade flow to all of their citizens and not 
just wealthy elites. This agreement will not promote democracy and 
stability in these nations. A stronger agreement would instead have 
bolstered the political and economic stability in these nations, 
through fair apportionment of benefits. In some of the DR-CAFTA 
nations, the agreement has proved to be quite polarizing and a better 
agreement could have gained broader public support.
  For the United States, DR-CAFTA was a missed opportunity to 
reconstitute the bipartisan consensus in support of international 
trade. Rather than consult widely and develop a consensus, the 
administration has decided to go for a narrow victory with disturbing 
implications for the possibility of bipartisan trade agreements in the 
future. In a time when Americans are facing increasing economic 
anxiety, trade is often viewed with suspicion. An administration which 
fails to consult and pushes for trade agreements which are unable to 
get bipartisan support undermines public support for international 
trade as a tool for economic development and greater prosperity. Even 
if the administration is successful in gaining passage of DR-CAFTA, I 
fear that this victory will be hollow as the anxiety over international 
trade continues to grow. In the end, the administration's strategy to 
ignore consultation and consensus in its trade policy may do more harm 
for the cause of international trade than the purported benefits of 
this agreement.
  While it is inevitable that some will benefit more than others from 
open markets, we have a responsibility to ensure that the basic rules 
of the game are fair. In previous trade agreements, this balance was 
achieved. And I voted for those agreements. DR-CAFTA fails this test.
  This is a sad day for supporters of free and fair rules-based trade. 
Our relationship with our Central American neighbors is a critical one. 
The right CAFTA deal would strengthen ties between the United States 
and these nations. I urge the administration to reopen the CAFTA 
negotiations and re-establish the broad, bipartisan coalition for 
trade.
  Mr. JOHNSON. Mr. President, I rise today to express my opposition to 
the Central American Free Trade Agreement, CAFTA. The United States 
Congress has been waiting for over a year to consider this agreement 
which was signed on May 28, 2004, because of the contentious nature of 
many of the agreement's provisions. It is those provisions that I rise 
today to address.
  Ethanol is an incredibly important industry in my home State of South 
Dakota. It is imperative for facilitating additional market 
opportunities for producers in the State and adding value to 
agricultural commodities. CAFTA maintains the ethanol provisions 
contained in the Caribbean Basin Initiative, CBI, which allows CBI 
countries to export up to 7 percent of the U.S. ethanol market duty-
free containing no local feedstocks. Under these provisions, I am 
concerned that Central American countries may function as conduits for 
South American ethanol. El Salvador and Costa Rica, in particular, are 
granted generous carve-outs from the total ethanol allotments under 
CAFTA. El Salvador will eventually be allowed .7 percent of the U.S. 
market, and Costa Rica will be allowed twice what they are currently 
importing into the U.S. under CAFTA.
  I have worked tirelessly with my Senate colleagues to ensure an eight 
billion gallon Renewable Fuels Standard, RFS, in the Senate version of 
the Energy bill. As our United States ethanol market increases, so to, 
under this agreement, does the quantity of the market afforded to CAFTA 
countries--or afforded to ethanol en route to the U.S. through CAFTA 
countries for a quick and easy reprieve from tariffs. Foreign producers 
of ethanol will find the U.S. even more attractive with an 8 billion 
gallon RFS, and I am concerned for the impact that this, and future 
trade agreements, will have on the ethanol industry. I simply cannot 
support an agreement that may undermine one of the most important 
industries in my home state, and set a dangerous precedent for future 
agreements of this nature. Specifically, producers have expressed 
concerns for the pending Free Trade Area of the Americas, and the 
impact that CAFTA will have on this potentially detrimental agreement.
  The sugar provisions are troubling as well, and have been a marked 
point of contention causing controversy among agriculture groups. I 
continue to hear from producers in my home State who are concerned with 
the potential impact of displaced sugar acres from this agreement, as 
the treatment of sugar will impact numerous commodities in South 
Dakota. Producers are concerned that displaced sugar acres will lead to 
increased corn and soybean acres, depressing commodity prices for corn 
and soybeans. Parts of this agreement are still being negotiated, 
specifically with respect to the sugar compensation mechanism to ensure 
we have not imported more than 1.5 million tons of sugar, and I fail to 
see how we can adopt an agreement with so many outstanding questions.
  Secretary Johanns indicated that a few possible compensation 
mechanisms existed for the sugar industry, which the sugar industry has 
thoroughly rejected. The Secretary actually proposed purchasing sugar 
that would otherwise surpass the trigger limit and use that sugar for 
nonfood items, specifically ethanol production. Using foreign sugar to 
produce ethanol is an incredible, and outrageous proposal. It will only 
function to displace a hard-earned market for domestic corn producers. 
Instead of offering a reasonable solution to the sugar industry, the 
administration is now persisting to sacrifice domestic commodities to 
placate opposition to this incredibly flawed agreement. Alternatively, 
U.S. agricultural commodities may be offered up as compensation for 
undesired sugar from CAFTA countries. And both of these proposed 
compensation mechanisms are temporary, through the life of the Farm 
bill only. The administration is persisting with this Band-aid 
approach, while offering no real or meaningful solutions.
  CAFTA fails to address key labor issues and environmental standards. 
Under CAFTA, countries are not obligated to uphold International Labor 
Organization, ILO, laws and the agreement fails to include enforceable 
labor standards. The agreement states that countries should ``strive 
to'' ensure their labor laws are comparable to international labor 
laws, but includes no enforcement mechanisms. This effectively renders 
the aforementioned laws meaningless. The agreement speaks to the 
enforcement of domestic labor laws--the enforcement of domestic labor 
laws, however, that are held to no particular standard. Aside from an 
ethical and moral dilemma, this agreement also functions to highlight 
an economic dilemma. The lack of labor standards will arguably present 
a

[[Page 15099]]

competitive advantage over U.S. companies that are observing labor 
standards and ensuring, quite simply, the humane treatment of their 
employees.
  Myriad reports exist that detail the harsh and unforgiving conditions 
workers are subjected to in countries with lax, or nonexistent, labor 
standards. According to ILO estimates, 17 million children between the 
ages of 5 to 14 are part of the working population in Central American 
countries. These children all too often miss out on any type of formal 
schooling because they are responsible for earning a meager salary, 
just a few dollars, to contribute to their family's income. These dire 
economic circumstances only function to illustrate the weakened labor 
standards that CAFTA will, effectively, endorse and sanction. 
International human rights organizations have repeatedly criticized 
labor standards in CAFTA countries, and this agreement does nothing to 
remedy this. Additionally, these circumstances underscore an inability 
on the part of CAFTA countries to purchase a substantive amount of 
American commodities.
  Additionally, the environmental standards in CAFTA are troubling. 
Countries will be deterred from instituting meaningful environmental 
regulations when they may be held accountable for any inconveniences 
that foreign investors experience. International tribunals will enable 
foreign investors to challenge meaningful environmental regulations and 
rules that were instituted to preserve the environment. Foreign 
investors may expect and seek monetary compensation.
  I voted against the North American Free Trade Agreement, NAFTA, 
because I was concerned for the detrimental impacts on our rural 
communities and for the preservation of rural America. I continue to 
hear from producers in South Dakota who are concerned for the impacts 
of NAFTA on our economy, and I am concerned for the proposed expansion 
of this model under CAFTA. Producers are simply tired of seeing the 
unrecognized trade benefits promised under these trade agreements.
  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

[[Page 15100]]

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:

         Executive Office of the President, the United States 
           Trade Representative,
                                    Washington, DC, June 28, 2005.
      Hon. Jeff Bingaman,
     U.S. Senate,
     Washington DC.
       Dear Jeff: As the Congress considers the Central America-
     Dominican Republic Free Trade Agreement (CAFTA-DR), you have 
     raised concerns about ongoing efforts to improve enforcement 
     of labor laws and to monitor progress in this regard in the 
     CAFTA-DR signatory countries. As you know, Congress 
     appropriated $20 million in FY05 specifically for projects to 
     improve labor and environmental law enforcement in these 
     countries.
       The recent House Appropriations Committee mark-up of the 
     FY06 Foreign Operations appropriations bill increases this 
     commitment for the next fiscal year, with $40 million 
     earmarked for labor and environmental enforcement capacity-
     building in the CAFTA-DR signatory countries. The 
     Administration is willing to support this level of funding in 
     the FY06 Senate appropriations bill.
       Furthermore, because we are willing to make a longer-term 
     commitment to improve labor and environmental law enforcement 
     in the CAFTA-DR countries, the Administration is willing to 
     propose and support this same level of labor/environment 
     capacity-building assistance for the next three fiscal years, 
     FY07 through FY09.
       More specifically, you have suggested the assistance of the 
     International Labor Organization (ILO) in monitoring and 
     verifying progress in the Central American and Dominican 
     governments' efforts to improve labor law enforcement and 
     working conditions.
       We are willing to implement your idea. Your proposal, as I 
     understand it, is that the ILO would make a transparent 
     public report of its findings every six months. The 
     Administration has now consulted with the ILO and determined 
     that this function would require additional funding to the 
     ILO of approximately $3 million annually. The Administration 
     is willing to devote approxiniately $3 million of the $20 
     million in FY05 labor enforcement assistance monies to 
     support and fund this ILO monitoring initiative. To ensure 
     that this monitoring continues, the Administration is willing 
     to continue a funding commitment to ILO monitoring for the 
     next three fiscal years, FY07 through FY09.
       The Administration also shares your goal of ensuring that 
     we pair expanded trade opportunities with economic 
     development assistance designed to ease the transition to 
     free trade, especially for rural farmers in our CAFTA-DR 
     partners. On June 13, 2005, the U.S. Millennium Challenge 
     Corporation (MCC) signed a $215 million compact with Honduras 
     targeted specifically at rural development and 
     infrastructure, and on the same day the MCC announced a $175 
     million compact with Nicaragua that will be signed shortly.
       As Secretary Rice and I have already communicated to you, 
     we are willing to give high priority to negotiating compacts 
     with El Salvador, Guatemala; and the Dominican Republic when 
     those countries become eligible for MCC assistance under 
     higher per capita income caps next year. I anticipate that 
     such compacts would provide substantial U.S. economic 
     assistance for rural development in these countries.
       In addition, the administration has worked with the Inter-
     American Development Bank (IDB) to provide new assistance, 
     including $10 million in new grants announced by the IDB 
     earlier this month for rural development and institution 
     building. I hope you will join me and officials from the IDB, 
     World Bank, and other institutions next month for an 
     international donors conference to discuss other ways we can 
     direct development assistance toward meeting the needs of 
     rural populations.
       To address your specific concern about the period before 
     MCC compacts might be negotiated with El Salvador, Guatemala, 
     and the Dominican Republic, the administration is willing to 
     support additional spending for rural development assistance 
     of $10 million per year for each of those countries starting 
     in FY07 for a total of five years, or until the signing of an 
     MCC compact with such country, whichever comes first. This 
     amounts to a $150 million commitment in transitional rural 
     assistance for these countries over five years.
       These monies will provide transition assistance to rural 
     farmers in these three countries for a defined period, while 
     preserving a very strong incentive for candidate countries to 
     meet the statutory criteria to receive what would likely be 
     much higher levels of economic assistance under an MCC 
     compact. Since the implementation of CAFTA-DR requires steps 
     which reinforce the statutory criteria for funding under the 
     MCC law, I believe that implementation of the agreement will 
     assist these three countries to move quickly toward 
     qualifying for a successful MCC compact with the United 
     States.
       Furthermore, because many of the agreement's requirements 
     for agriculture liberalization in the CAFTA-DR countries for 
     sensitive commodities--such as dairy, poultry, and rice--will 
     not fully occur until ten, fifteen, or even twenty years 
     after CAFTA's implementation date, I am confident that this 
     transitional mechanism provides ample time for adjustment in 
     the rural economies of these nations.
           Sincerely,
                                                      Rob Portman.

  Mr. SPECTER. Mr. President, I seek recognition today to express my 
objections to the U.S. Central American Free Trade Agreement, CAFTA. I 
have spent a considerable amount of time reviewing the contents of the 
agreement and there remain outstanding questions regarding labor and 
agriculture. Until these questions are satisfactorily answered, I am 
opposed to the agreement.
  Since June of 1998, Pennsylvania has lost 199,600 manufacturing jobs. 
Nationwide nearly 900,000 manufacturing jobs have been lost. These 
statistics are staggering. Unfortunately, this trade agreement would 
adversely affect this job loss in the United States; especially in 
Pennsylvania. As I reviewed the agreement, I noticed the establishment 
of a new legal regime that increases safeguards for multinational

[[Page 15101]]

investment through changes in tariff rates, rules of origin, and quota 
phase-outs, which would allow corporations in Central America to sell a 
product at a cheaper price. In order to compete under these conditions, 
many U.S. corporations would have to shut down their operations, export 
their jobs, and leave skilled workers jobless. This agreement would 
aggravate the problem.
  In addition to job loss, this agreement fails to enhance workers' 
rights. Over the course of the last 5 years, Congress has worked to 
establish a standard within trade agreements that protects workers' 
rights. In 2001, when Congress adopted the Jordanian Trade Agreement, 
labor provisions were included in the body of the agreement. These 
labor provisions were made subject to sanctions through the dispute 
resolution process. Unfortunately, this agreement only strives to 
enforce workers' rights but does not offer provisions for Central 
Americans to unionize, collectively bargain, and secure the right to 
strike.
  Currently, the six CAFTA nations are subject to the Generalized 
System of Preferences, GSP, and the Caribbean Basin Initiative, CBI, 
which condition market access with respect to the International Labor 
Organization, ILO, standards. Linking market access to labor 
protections has been responsible for many significant labor reforms in 
Central America in the last 20 years. However, if enacted, CAFTA does 
not mandate that the labor laws of the Central American countries 
comply with the International Labor Organization, ILO, core standards, 
which include freedom of association, the right to organize and bargain 
collectively, and the freedom from child labor, forced labor, and 
discrimination.
  Ultimately, CAFTA would create downward pressure on wages because it 
would force our American workers to compete with Central American 
workers who are working for lower wages. This would allow foreign based 
companies to expand while leaving America more dependent on imports 
from abroad, which in turn would lessen the demand for domestic 
production and create even greater economic instability.
  Finally, CAFTA's impact on agriculture is problemsome. CAFTA will not 
open new markets for American agriculture goods. The U.S. is already 
the CAFTA regions largest trading partner. In many cases, our farm 
exports to the six CAFTA nations face tariffs that are low or 
nonexistent and dominate their agricultural markets in several 
commodities. The International Trade Commission has indicated that 
there would be little gain for agriculture. For example, currently, the 
U.S. supplies 94 percent of all grain into the region.
  I urge my colleagues to carefully examine this trade agreement. As a 
nation, we cannot continue to allow the erosion of our manufacturing 
base. Equally, CAFTA should continue to meet the labor standards 
created in previous trade agreements, which it must before I will 
consider supporting it. For these reasons I am voting no.
  Mr. CARPER. Mr. President, free trade--when done correctly--can be an 
important tool in building consumer demand for U.S. products worldwide, 
encouraging investment and growth in developing markets, and forging 
new alliances. Today, Congress is considering an agreement to expand 
trade with Central America and the Dominican Republic.
  Delaware is already heavily engaged in trade with Central American 
countries, with $25 million in exports in 2004. In fact, a large amount 
of the fruit imported through the Port of Wilmington by Chiquita and 
Dole come from Central America. However, while 75 percent of Central 
American products enter the United States tariff free, almost all U.S. 
goods continue to face tariffs in Central America. The Dominican 
Republic-Central America Free Trade Agreement, or DR-CAFTA, will level 
the playing field for U.S. workers and businesses that rely on exports 
to Central America and the Dominican Republic by providing immediate, 
duty-free access for more than 80 percent of U.S. consumer and 
industrial goods.
  For Delaware, this will lift tariffs on the fabrics supplied by 
companies like Invista to sewing operations in Central America, making 
textiles in the Americas more competitive with China. Delaware's 
poultry producers will finally gain access to Central American markets 
under DR-CAFTA. When the agreement goes into effect, some U.S. chicken 
products will be given immediate duty-free access, and that access will 
expand annually until duties are eliminated.
  Free-trade agreements with developing countries also offer an 
opportunity to encourage reform. Certain reforms were accomplished in 
DR-CAFTA, such as competitive bidding for government contracts and 
protection of copyrights, patents and trademarks--very important to 
Delaware companies such as AstraZeneca and Dupont.
  However, we have not used the opportunity provided by the negotiation 
of this agreement to make as much progress as we should have, 
particularly in improving conditions for workers and protecting the 
environment. Steady progress was made in the 1990s in the way these 
important issues were addressed. By the time the Jordan Free Trade 
Agreement was adopted in 2001, labor and environment provisions were 
all subject to sanctions through the agreement's dispute resolution 
process. This was an important advancement, not just for workers in 
developing nations but also for competing workers and businesses in the 
United States. The agreements Congress has considered since 2001 have 
retreated from this strong enforcement standard, and this has 
unnecessarily weakened the bipartisan support for free trade that we 
have built over the years.
  While I am pleased that the administration has agreed to support an 
increase in funding to support efforts to improve labor and environment 
conditions in Central America, I am aware of no reason to back off of 
the strong enforcement of labor and environmental obligations that we 
have included in several agreements. Let me be clear. The 
administration must include a greater level of enforcement of labor and 
environment standards in those trade agreements currently being 
negotiated in order to be assured of garnering my support in the 
future. It is particularly important that we enforce the obligation not 
to backslide or repeal current labor and environmental laws and 
regulations.
  I will be watching the negotiations of the Andean and Thailand trade 
agreements closely. If this administration is serious about getting 
those approved, they will listen to the concerns that have been 
expressed in the debate over DR-CAFTA, consult with Democrat and 
Republican Senators during the course of those negotiations and send 
the Senate free trade agreements with stronger enforcement of labor and 
environmental standards. In the months and years ahead.
  Mr. CORZINE. Mr. President, after serious deliberation, I will be 
voting against the United States-Dominican Republic Central American 
Free Trade Agreement, or CAFTA. While I support the principle of free 
trade, free trade must also be fair. I have supported our trade 
agreements with Australia, Jordan, and Morocco because these agreements 
reduce or eliminate barriers to American exports while preserving and 
protecting important labor, environmental and security interests around 
the globe.
  A trade agreement between the United States and Central America with 
the same safeguards has the potential to serve as an important tool for 
promoting development and advancing meaningful socioeconomic reform in 
the region. That said, the agreement before us takes a significant step 
back from previous agreements with respect to both labor and 
environmental protections, and will only exacerbate the outsourcing of 
American jobs and aggravate an already dangerous world trade imbalance. 
American workers justifiably feel insecure in today's economy, and the 
outsourcing of American jobs at home is a major reason. The increasing 
trade deficit puts an exclamation point on their concerns.
  I would like to understand how this agreement is not just another in 
a long

[[Page 15102]]

line of bad trade agreements that exacerbate our trade problems. Before 
we rush forward with policies that on the surface are failing, I would 
like some assurances that this won't be just another punch to the 
stomach of American industry and American workers. What we have been 
doing obviously has not been working. Why do we continue down this 
misguided path? The American trade deficit over the past ten years 
demonstrates we're on the wrong track.
  At a more parochial level, since NAFTA was implemented in 1994, New 
Jersey has lost 130,000 manufacturing jobs--46,000 as a direct result 
of NAFTA. New Jersey was once a center for manufacturing. In 1996, 
Allied Signal in Eatontown sent 230 jobs to Mexico, and required the 
laid off workers to train their Mexican replacements. American Standard 
in Piscataway and Hamilton sent 495 jobs to Mexico. Patterson's textile 
industry disappeared. I could go on and on about town after town in New 
Jersey that lost jobs after NAFTA--from Millville to Elizabeth, from 
Woodbridge to Pennsauken. Another bad trade agreement is the last thing 
New Jersey needs.
  It is clear this is part of the Bush administration's misguided 
strategy with respect to U.S. trade policy. The Bush administration has 
made CAFTA, not China, is its No. 1 trade priority. Yet trade with 
Central American countries represents only 1.5 percent of U.S. trade. 
The Gross Metropolitan Product, GMP, of the city of Newark is $103 
billion, larger than the GDP of all of these countries combined, $85.2 
billion. Compare that with the fact that, just last year, the United 
States ran a $162 billion trade deficit with China. Our trade deficit 
alone with China is nearly double the GDP of the entire Central 
American trade region. This is a much more pressing issue for our 
economic security, and we should be focusing our attention on where the 
risks to imbalances are. Where is the pressure for currency adjustment 
with China or the protection of intellectual property rights?
  But this administration insists we first take up CAFTA, and so I feel 
compelled to discuss my opposition to this agreement. Free trade 
agreements must protect the rights of workers, both at home and abroad. 
When NAFTA was passed by Congress more than eleven years ago, there was 
great hope that the agreement would create thousands of new jobs in 
America and promote labor rights abroad.
  Yet, as we stand here 11 years later, we know that the U.S. 
Department of Labor has certified more than 525,000 workers for NAFTA 
trade adjustment assistance because their jobs were lost due to NAFTA 
imports or shifts in production to Canada or Mexico under NAFTA. Those 
same numbers reveal that, through 2002, more than 46,000 New Jersey 
workers had similarly lost their jobs. And the numbers are actually 
more serious, because since 2002, the Department of Labor has refused 
to release these sobering statistics--some estimates suggest it is 
closer to one million jobs lost.
  The U.S. International Trade Commission, ITC, predicts that CAFTA 
will actually increase the U.S. trade deficit with Central America 
because American companies will relocate their workforces and export 
their products back to the United States, just as companies did under 
NAFTA. This can continue to decimate communities across the country, as 
local plants shut down and the jobs moved overseas. NAFTA established 
the Trade Adjustment Assistance program, TAA, to help thousands of 
manufacturing workers receive retraining, keep their health insurance, 
and make a new start. But service sector jobs were left out. During the 
past several years, nearly half a million service jobs have moved 
offshore to other--mostly low-wage--countries. Senator Wyden's 
bipartisan amendment to extend TAA to service employees was accepted by 
the Finance Committee. Yet, when President Bush sent the CAFTA 
legislation to Congress, this amendment had been stripped from the 
bill. This amendment was sensible, it was fair, and it should have been 
included in this legislation.
  For all of the harm CAFTA would cause U.S. workers, I am equally as 
concerned about the harm the agreement could do to the rights and 
protections of workers in Central America. A fair trade agreement must 
require each nation to improve domestic labor laws to meet basic 
workers' rights. And it should discourage our trading partners from 
weakening or eliminating entirely their labor laws in order to gain an 
unfair trade advantage. But CAFTA does neither. CAFTA's lone 
enforceable workers' rights provision requires only that these 
countries enforce their own labor laws--laws that our own State 
Department has said fail to meet recognized international standards. 
This not the standard for commercial or investment standards. This 
failure to include an enforceable requirement that labor laws meet 
basic international standards represents a significant step backwards 
from the labor rights provisions of our agreement with Jordan, a 
country with significantly stronger labor protections. In our shared 
goal at improving labor standards around the world, trade agreements 
like CAFTA should be both the carrot and the stick. CAFTA is neither.
  CAFTA proponents have argued that this agreement is the principle 
means to lift Central America out of poverty and promote these shared 
principles. But this agreement will not do that, and the consequences 
of NAFTA are evidence of why. Since NAFTA was implemented more than 
eleven years ago, real wages in Mexico have fallen, the number of 
people in poverty has grown, and the number of people illegally 
migrating to the United States to seek work has doubled.
  NAFTA's liberalization in the agriculture sector displaced more than 
1.7 million rural small farmers, overwhelming the 800,000 number of new 
jobs created in the export processing sectors. Rather than learn from 
these sobering failings by negotiating a trade agreement that creates 
good jobs, guarantees worker rights, and lays the groundwork for a 
strong middle class, the Administration has cloned NAFTA. 
Unfortunately, the results are likely to be the same.
  What is also likely to be the same is the devastating impact on the 
environment that CAFTA is likely have on Central America. Central 
America is one of the most biologically diverse areas of the world. The 
region faces daunting environmental challenges that threaten its 
potential for sustainable development. Yet CAFTA would undermine hard-
won environmental protections by allowing foreign investors to 
challenge environmental laws and regulations in all of the countries, 
including the U.S., that are parties to the agreement.
  We have not learned the lessons of the past. This is another bad 
trade agreement that fails to address the real economic issues our 
nation faces today. We should be addressing our trade imbalance. We 
should be promoting job growth here in the United States, instead of 
further encouraging companies to move jobs elsewhere. I oppose CAFTA 
because it fails to preserve worker rights, protect the environment, or 
promote economic development at home and abroad. It is wrong for New 
Jersey, and it is wrong for America.
  Mr. SMITH. Mr. President, more than 20 years ago President Reagan 
made a commitment to help the countries of Central America by providing 
them with unilateral access to the U.S. market. Through preference 
programs such as the Generalized System of Preference, GSP, and the 
Caribbean Basin Initiative, Congress and various administrations have 
sought to help our southern neighbors by promoting development and 
encouraging the building of democratic societies.
  The Caribbean Basin Initiative has provided critical economic aid to 
the fledgling democracies of Central America, and in the past 20 years, 
chaos has been replaced by commerce.
  Since 1985, exports from the region to the United States have 
quadrupled; and today, the agreement that we are taking up seeks to 
provide reciprocal access for our domestic producers.
  Today, 80 percent of goods and services and 99 percent of 
agricultural products from the DR-CAFTA countries already enter the 
U.S. duty free.

[[Page 15103]]

In contrast, our domestic producers face steep tariffs--which are 
essentially foreign taxes--into the region. Under DR-CAFTA, many of 
those tariffs would go to zero.
  It is estimated that if approved, DR-CAFTA would result in 
approximately $1 billion in annual savings on tariffs for U.S. 
producers.
  Under DR-CAFTA, Oregon apple and pear growers, who currently face 
tariffs as high as 25 percent into the region, will benefit from 
immediate duty elimination on fresh apples and pears.
  Oregon potato producers benefit from duty elimination on certain 
potato products, including french fries, which will immediately become 
duty-free in most DR-CAFTA countries.
  With $104 million in export sales and total cash receipts of $155 
million, Oregon's wheat producers will benefit from the immediate 
elimination of tariffs on wheat and barley in all six countries. An 
American Farm Bureau analysis shows that U.S. agriculture may gain $1.5 
billion in increased exports each year when the agreement is fully 
implemented.
  Oregon retailers, including Nike and Columbia Sportswear, would 
benefit from greater market access and increased sourcing options.
  Intel, another major employer in my state, stands to benefit from 
this agreement. The DR-CAFTA countries combine to rank as Oregon's 10th 
largest export market. According to the Office of Trade and Economic 
Analysis, 94 percent of Oregon's exports to the region in 2003 were 
high-tech products. For the 15,500 Intel employees in Oregon, DR-CAFTA 
is critical for future growth in the region.
  This agreement is about leveling the playing field for our domestic 
producers. The DR-CAFTA countries already have access to our market; 
this agreement gives our growers and manufactures a chance to thrive in 
DR-CAFTA markets.
  In recent weeks, this agreement has been endorsed by the Oregonian, 
the New York Times, the Washington Post, the Wall Street Journal, the 
Los Angeles Times, and USA Today.
  I understand that there are those who are not entirely happy with 
this agreement, including some in my own State. However, I come from a 
State in which one in four jobs is tied to exports. This agreement is 
about increasing export opportunities for producers in my State and 
around the country.
  A recent editorial in the Oregonian said this about the agreement:

       It is disturbing to see Oregon and national leaders back 
     away from the principle that free and fair trade is good for 
     the United States and the rest of the world. People are 
     better off in an integrated global economy where they have 
     the opportunity to sell their goods, services, and skills 
     around the world.

  As a businessman, I have seen firsthand the remarkable ability that 
trade has to raise the standard of living both domestically and around 
the world. I am hopeful that by passing this agreement, we will be able 
to create new growth opportunities for U.S. and Central American 
producers, and we will be able to show that America truly is a leader 
in furthering free and fair trade.
  Mr. BYRD. Mr. President, I want, first to compliment the subcommittee 
chairman of the Energy and Water Appropriations bill, Senator Peter 
Domenici, and the ranking member, Senator Harry Reid, for the 
outstanding job they have done in putting together this bill. The well-
being of the Nation depends greatly upon adequate investments in the 
many programs and activities contained in this bill.
  Through this measure, we are supporting the backbone of our Nation's 
water transportation and flood protection programs through the Army 
Corps of Engineers; the irrigation water supply systems for the western 
States through the Bureau of Reclamation; the protection of our 
Nation's nuclear weapons stockpile; the advancement of science programs 
to help ensure that the United States remains a leader in the 
international scientific community; a number of independent agencies 
and commissions, including the Appalachian Regional Commission, the 
Denali Commission, and the Delta Regional Authority; and now, due to 
the restructuring of subcommittee jurisdictions, the entire Department 
of Energy, DOE.
  As part of that restructuring, the Energy and Water Subcommittee was 
charged with oversight and appropriations responsibilities for the 
fossil energy research and development, R&D, within the Department of 
Energy. Senator Domenici and I have long worked on these programs, and 
I thank him and Senator Reid and their staffs for their hard work, 
diligence, and support for fossil energy research in this bill.
  Through the Fossil Energy R&D programs, DOE supports research 
involving economically and environmentally sound use of our Nation's 
domestically produced fossil energy resources. It forges partnerships 
between Government and industry to accelerate the development, 
demonstration, and deployment of advanced technologies that show 
promise in helping to ensure cleaner, more reliable, and more 
affordable energy, now and in the future.
  While the subcommittee did not hold a fiscal year 2006 budget hearing 
on the fossil energy R&D programs this spring, I appreciate Senator 
Domenici's commitment to hold annual oversight hearings on the fossil 
energy programs beginning next year. I look forward to participating in 
these hearings as our fossil energy resources will continue to be 
important to this Nation.
  I would also like to mention that the clean coal program, which falls 
under the fossil energy portfolio, has been critical to the development 
of cleaner, low-carbon fossil energy technologies.
  I created the Clean Coal Technology program in 1985, and I am very 
proud to report that after five solicitations, 32 projects have been 
completed, with a combined value of $3.7 billion Government/industry 
investments to develop advanced technologies that are resulting in 
cleaner, more efficient, and more cost-effective power generation.
  The subsequent Clean Coal Power Initiative, started by President Bush 
in 2000, was to be a $2 billion demonstration program over 10 years, 
consisting of four rounds of solicitations. The administration's fiscal 
year 2006 budget request of $50 million falls woefully short of being 
able to keep the CCPI on a 2-year solicitation schedule. However, I am 
very appreciative of the additional $50 million that was provided by 
Senators Domenici and Reid, at my request. This funding will help to 
pave the way for a third CCPI solicitation in the near future.
  If we ever hope to increase our energy security, reduce our 
dependence on foreign energy resources, and develop fossil energy 
technologies that allow us to burn coal with little to no pollution, we 
must adequately invest in these critical programs. There are no better 
champions for energy research than Senator Domenici, Senator Reid, and 
me. We have been able not only to authorize initiatives so critical to 
America's energy independence, but we also have been able to direct 
resources to those important efforts and keep them adequately funded 
for at least another year.
  On Tuesday, June 28, 2005, the Senate passed a bipartisan Energy 
bill, and I was happy to support that bill. It is generally a positive 
bill, but it is also very much of a business-as-usual approach toward 
energy policy. This bill simply provides authorization for new and 
existing programs related to energy policy. Despite the fact that the 
administration is strongly pressing for an Energy bill, I have to 
wonder if the necessary funding to support this legislation will ever 
emerge in subsequent administration budgets.
  Certainly, the administration's track record on funding other 
important measures like No Child Left Behind makes one wonder if energy 
funding will face continued shortfalls despite the prized rhetoric and 
Rose Garden ceremonies. Due to very constrained budget allocations, the 
Appropriations Committee is likely to find it extremely difficult to 
maintain funding for current energy programs, to say nothing of adding 
funding for the new or expanded energy programs in an Energy bill.
  At least for the next fiscal year, the Senate's mark for the fossil 
energy programs will keep these programs moving in the right direction, 
despite the administration's budget cuts.

[[Page 15104]]

Again, I thank the chairman and the ranking member of the Energy and 
Water Subcommittee and their staff, Scott O'Malia, Roger Cockrell, 
Emily Brunini, Drew Willison, and Nancy Olkewicz, for their 
extraordinary efforts in this regard and for producing a bill that I 
believe we can all support.
  Mr. DURBIN. Mr. President, I rise to oppose CAFTA for the reasons I 
stated earlier. It seems logical to say that if we want to expand our 
export markets, we should be negotiating with countries who have a more 
sizable market for our goods and greater buying power to purchase our 
goods. However, these CAFTA countries account for only 1.5 percent of 
U.S. exports.
  Illinois is an agriculture State. I have supported prior trade 
agreements because of the benefit they have provided to agriculture. 
However, estimates that passage of CAFTA will produce sizable trade 
gains for U.S. farmers are overly optimistic. CAFTA countries have a 
combined population of approximately 31 million people who generally 
have limited incomes with which to purchase agriculture products. In 
fact, the market is only worth $1.6 billion in annual agriculture 
products.
  According to the most recent data, the U.S. supplied 94 percent of 
all grains imported into the six CAFTA countries. This domination means 
there is little room for further upward growth in grain exports to 
CAFTA nations.
  I believe in international trade, provided it is fair trade and can 
expand our economy and create jobs. But I have concluded that this 
trade agreement will not do that. It is merely another product of this 
administration's failed trade strategy--a strategy that has victimized 
American manufacturers while costing millions of American workers their 
jobs. The administration is so wedded to the notion that all is well 
that it cannot hear the cries of those who would be harmed by this 
trade agreement. The failure to take sufficient and educated steps to 
strengthen America's future in this trade agreement is why I am 
opposing CAFTA.
  Mr. BIDEN. Mr. President, not that long ago, for the average 
American, our world was not a threatening place. Not long ago, there 
was little reason for the average American to feel anxious about the 
future. The United States was the only superpower; our economy was 
enjoying record growth and job creation.
  Those things are no longer true. The rise of terrorism, the war in 
Iraq, international economic competition from new sources like China 
and India, as well as increased economic insecurity here at home--
together these forces have cost us a lot of our optimism, a lot of our 
self-confidence.
  We are a people whose birthright is a belief in a better future, a 
belief in our ability to control our own fate, at home and abroad. That 
is our national character. But these days, our character is being 
tested.
  Even in the best of times, trade legislation has been a touchy 
subject. These days, it can be among the most contentious issues we 
confront. Our trade deals carry the freight of our insecurities, 
economic and otherwise.
  They carry our worries about our place in international competition, 
about job security, about losing our grip on our standard of living. 
There are real reasons that Americans are worried these days. Studies 
by the Federal Reserve and others confirm that income mobility--the 
opportunity for children to do better in life than their parents is 
declining, approaching the levels of more static, developing economies.
  Without poring over statistics, Americans can see that happening. The 
reality of self-determination, the fact of social mobility, has been 
the foundation of our optimism. When the facts change, when the pace of 
mobility slows, it shows. Instead of a generation or two between 
poverty and a solid middle class living, today it can take five or six 
generations.
  We have yet to produce one single new job since this administration 
came into office. Not one. Whomever you blame or however you explain 
it, that is a fact that registers in the lives of Americans. Not since 
the Great Depression has it taken so long to replace lost jobs.
  That is why long-term unemployment--over half a year looking for a 
job--is the lot of over a million and a half Americans.
  These conditions keep wages low, falling behind the cost of living. 
Real wages are falling at a rate we haven't seen in 14 years.
  Into these tough times comes the word that 2 billion new workers, in 
China and India, to take the two biggest examples, are now competing 
with Americans for new jobs created in the global economy.
  These workers are highly motivated--the poverty they are rising from, 
the pace of growth they can see in their cities, is a powerful 
incentive. Their governments are increasingly sophisticated about 
attracting investment and expertise from here and around the world to 
fuel their national economic strategies.
  With these troubling trends, Americans are in no mood to accept text 
book platitudes about the benefits of free trade. They want to see some 
of the gains come home.
  I am personally convinced that trade is in fact not only ultimately 
good for us, but inevitable. Standing at our shores, commanding the 
tides of trade to retreat, is not a plan for our Nation's economic 
future.
  We fought and won a Cold War in the last century a war against a 
totalitarian economic ideology, to protect and project American values 
of political and economic freedom in the world.
  Now is not the time to doubt those values. They are still the right 
values for us, and the right values for the citizens of other nations. 
Free men and women, freely exchanging goods and ideas, innovating, 
creating. That is the world we fought for, that is the evidence of our 
success.
  And what is the alternative? Do we expect to close our ports to 
products Americans want to buy? Can we expect to successfully block 
American companies from seeking profitable investments overseas?
  In today's world, American leadership is a reality. We cannot lead 
the world in the search for security but at the same time retreat 
economically. Trade can help cement peaceful ties, raise living 
standards, give desperate people hope and put idle hands to work. Trade 
must be part of our security strategy, or that strategy will not 
succeed.
  If there is to be a better world ahead of us, wealthier, healthier, 
freer--and I am certain that there is--then expanding international 
trade will be part of it. I don't think you can envision that world 
without expanding trade ties, expanding economic integration.
  But there is no free lunch. This world comes at a cost. It comes at 
the cost of predictability, at the cost of stability. The economist 
Joseph Schumpeter called capitalism a process of creative destruction. 
And that it is.
  The telephone replaced the telegraph, the automobile replaced the 
horse, supermarkets replaced mom-and-pop grocery stores. Our farms are 
mechanized; our manufacturing is robotized; our information is 
computerized. With every new idea, with every new invention, an old 
product, an old technology, and the jobs they sustained, are left 
behind.
  Our Nation has become wealthy riding the waves of innovation, 
opportunity, efficiency, and economic growth. That, in part, is the 
American way.
  But another part of the American way is our shared commitment to each 
other. With every wave of change, from agrarian nation to manufacturing 
power, to the world's richest economy, we have created the institutions 
to cope with the human costs of economic change. Child labor laws, 
minimum wage, the 40-hour workweek, these are evidence of our values. 
And we have Social Security, Medicare, unemployment insurance--all ways 
to share the costs and spread the burdens of a churning economy.
  Most fundamentally, we have established the rights of working men and 
women to bargain collectively for their wages and working conditions: 
these things are also the American way.

[[Page 15105]]

  When it is done right, trade makes us more efficient and more 
productive. With the economic gains from trade we can afford to take 
care of those whose jobs are lost as the new ones are created.
  There is a human logic to this, a logic that says the men and women, 
and their families and communities, who are displaced by economic 
change are not to blame for their fate. They should not shoulder alone 
the costs of change while others reap the benefits.
  There is an economic logic, as well--by compensating some for bearing 
the cost of change, we keep innovation and opportunity expanding for 
everyone.
  And finally there is a political logic. When we all know that we are 
not alone, that there are resources we can draw on in tough times, we 
don't have to fight change. Without that assurance, in our open 
political system, those who bear the cost of change and innovation 
will--understandably--resist it.
  If trade is ultimately good for our economy as a whole, we must make 
sure that it is good for American workers and their families, too.
  This trade deal does not do that, and that is why I cannot support 
it.
  I said 2 years ago that I was concerned about the lack of effective 
enforcement provisions for the labor standards in the Chile and 
Singapore trade deals, and the precedent that might set for the CAFTA 
negotiations. What we now call the ``Jordan standard,'' that treats 
labor provisions on the same terms as intellectual property and 
commercial provisions, allows for effective enforcement when a party 
fails to live up to its labor rights commitments. That effective 
enforcement standard is part of the Jordan Free Trade Agreement, now in 
effect.
  But instead of building on that success, CAFTA comes to us today 
without that effective means of enforcement.
  At a time when the political support for trade is shaky at best, with 
American families justifiably anxious about the volatility and 
insecurity just below the surface of our economy, why would we roll 
back the standards for labor protections in our trade deals?
  It just doesn't make any sense.
  I notice that there is a lot of new language in this trade agreement 
about labor rights in the countries of Central America and the 
Dominican Republic. That shows that our negotiators are getting the 
message about how important those provisions are to the political 
support we need for trade.
  But instead of providing labor standards with the same level of 
effective enforcement that American businesses will get for their 
concerns, this deal leaves labor a second-class citizen.
  But it is not just the specific terms of this trade deal that concern 
me today. If we are going to compete in today's global economy, we need 
a plan to protect American living standards and a plan to keep our 
Nation the most competitive on Earth.
  We need a good defense, but we need a good offense, too.
  We need a strong trade adjustment assistance program, and we need the 
will to enforce it. We need to make sure that health insurance, 
pensions, and other basic benefits are protected and portable in a 
changing world.
  I think we should consider a real wage insurance policy that 
addresses not just the jobs lost by trade--in reality, trade is a small 
part of the churning in our economy--but any job loss that could put a 
family's standard of living at risk.
  If we do it right--and right now we just have a small pilot program 
out there--wage insurance could provide real help to families in 
transition from one job to another and keep our labor markets open and 
dynamic.
  But important as those kinds of protections can be, they are just 
playing defense. Right now, I don't see a plan for an offense, a plan 
for us to take on the rising competition from around the world, a plan 
to make American working men and women the winners.
  That is going to take investments in education, in research, and in 
new technologies. That is going to take a commitment to making our 
workforce the most productive in the world, giving them the tools and 
the skills they need to compete. That is going to take a plan to create 
a new generation of good-paying jobs.
  On the education front, Bill Gates has told us that our high school 
graduates are not up to the standards his company needs. Newt Gingrich 
has called the administration's lack of investment in basic research, 
and I quote, ``unilateral disarmament'' in the face of international 
competition. Those are not partisan attacks. Those are warnings we 
cannot ignore.
  Because we don't have an adequate defense for the families who are 
affected by economic change, because we don't have an effective offense 
to win in a globalizing economy, I cannot lend my support to this trade 
deal. It sends the wrong message, it sets the wrong example.
  The CAFTA countries themselves are no more than 1 percent of our 
trade. In many ways, they are not the issue here. I believe it will be 
good for our country if these nations can enter our markets. It will 
make those economies stronger, make them better neighbors, and open 
markets for the products made by American workers.
  But only if the deal is done right. Only if we have the protections 
in place that can truly lift human rights, labor, and environmental 
standards there, and build the protections for American workers and 
producers here.
  So I will vote against CAFTA not because I oppose trade but because I 
support smart trade, trade that works for American families, trade that 
is good for both sides.
  I am afraid that more trade agreements along these lines will weaken 
domestic support for expanding trade. We need the full, informed 
consent of American citizens for trade, we need a trade agenda 
Americans can support, and we need to a plan to defend our standard of 
living here and to compete to win in the global economy.
  We need to win the support of American working families for expanded 
trade, and restore their faith in our ability to win. Until then, trade 
deals like this one will just add to their worries.
  Mr. BUNNING. Mr. President, I have spent many hours examining and 
discussing the agreement before us today.
  As my colleagues know, my vote has never been a rubberstamp for trade 
agreements.
  I take my responsibility to examine these agreements very seriously. 
My constituents deserve no less. In the past, I have supported trade 
agreements, and I have opposed trade agreements, as their merits 
demanded.
  After long and careful thought, I have decided that I will support 
the agreement with Central America which is before the Senate today.
  This agreement is not perfect--far from it.
  The phaseout times on many of the agricultural products are too long. 
We should not be waiting for 10, 15, sometimes 20 years for duty-free 
access to sell our farm products in these countries. It is my 
understanding that the protection of one particular American product 
was largely responsible for the negotiating situation that led to the 
long tariff elimination schedules for so many of our farming products.
  If not for the fact that, almost without exception, the Central 
American countries have enjoyed duty-free access to our markets for 
their agricultural exports for years, these long tariff phaseout 
schedules might well have forced me to oppose this agreement.
  The truth is, due to existing trade relationships, the various 
parties did not start out this trade negotiation on similar footings: 
We paid to export to them and they did not pay to export to us.
  While this agreement absolutely does not even this relationship as 
quickly and fairly as I would like, it does eventually get the job 
done. While our farmers are often forced to wait far too long for duty-
free acess, that duty-free access does eventually go into place. The 
opportunity for new export markets for our farmers will be--
ultimately--beneficial to the folks in Kentucky, particularly the rural 
parts of my State.
  While I have concerns about other parts of the agreement, 
particularly some textile issues, there are also aspects of the 
agreement which are especially good for Kentucky.

[[Page 15106]]

  Important to my State of Kentucky is the treatment of the exportation 
of tobacco products under the agreement. I was particularly pleased to 
see that the report of the Agricultural Technical Advisory Committee 
for Cotton, Peanuts, Planting Seeds and Tobacco, which included a 
member of the Kentucky Farm Bureau, found the agreement to be fair 
regarding tobacco trade.
  I was also pleased to see that this agreement immediately eliminates 
tariffs on bourbon and whiskeys exported from America. Furthermore, 
agreement for the recognition of ``bourbon'' as an exclusively 
Kentucky-made product is important to an industry employing over 30,000 
Kentuckians.
  I also want to bring the attention of my colleagues to the fact that 
this agreement, while obviously primarily a trade agreement, also 
represents an opportunity for us to show our support to a region that 
has come a long way in the area of democracy.
  Not so long ago, most of us here will remember, democracy was not 
assured in this part of the world. In Central America--our own 
backyard--communism was a threat. The United States has worked hard 
over the years and we have seen the menace of communism recede and the 
democracies and economies of El Salvador, Guatemala, Nicaragua and 
Honduras begin to flourish.
  We must not lose track of the message that the approval of this 
agreement will send to these new democracies on our doorstep. Without 
this agreement, the democracies we have helped build in Central America 
will be less prosperous in the increasingly competitive global 
marketplace. We must allow these fledgling democracies the access they 
need to compete with the overwhelming wave of Chinese imports.
  It is the development of strong trade in goods and services that will 
help these countries to oppose a return to corrupt regimes that promote 
trade in illegal drugs.
  We in this body have done so much to foster democracy and economic 
stability in Central America. The approval of DR-CAFTA is another 
chance for us to show our support of these democratic governments.
  I have come to believe after long and careful examination, that this 
agreement is good for the United States and for the future of Central 
America. I urge my colleagues to support the agreement before us today.
  The PRESIDING OFFICER. Under the previous order----
  Mr. BAUCUS addressed the Chair.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the following 
be the only remaining debate on the bill, in the following order: 
Senator Sessions, 10 minutes; Senator Dayton, 5 minutes; Senator 
Sununu, 5 minutes; Senator Ensign, 5 minutes; Senator Baucus, 10 
minutes; Senator Grassley, 10 minutes; Senator Reid from Nevada, 10 
minutes; Senator Frist, 10 minutes.
  The PRESIDING OFFICER. Is there objection?
  The Senator from North Dakota.
  Mr. DORGAN. Mr. President, reserving the right to object, how much 
time remains on my allocation?
  The PRESIDING OFFICER. The Senator from South Dakota has 11 minutes 
28 seconds.
  Mr. DORGAN. Mr. President, let me reserve 5 minutes of that as well.
  Mr. BAUCUS. Mr. President, I add that to the request.
  The PRESIDING OFFICER. Will the Senator from Montana state where he 
would like that placed in the order.
  Mr. BAUCUS. That would be after Ensign and before myself.
  The PRESIDING OFFICER. Is there objection to the modified request? 
Without objection, it is so ordered.
  The Senator from Colorado.

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