If the chair will be so kind to let me know when I have 2 minutes left? 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…
If the chair will be so kind to let me know when I have 2 minutes left?
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, 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.
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 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.