[Congressional Record Volume 151, Number 90 (Thursday, June 30, 2005)]
[Senate]
[Pages S7647-S7695]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




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

  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.

[[Page S7648]]

  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. 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

[[Page S7649]]

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 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

[[Page S7650]]

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 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.

[[Page S7651]]

  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.
  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,

[[Page S7652]]

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 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 dozens 
     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

[[Page S7653]]

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.
  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, 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

[[Page S7654]]

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 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--

[[Page S7655]]

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 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.

[[Page S7656]]

  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 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

[[Page S7657]]

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 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

[[Page S7658]]

     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 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,

[[Page S7659]]

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-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,

[[Page S7660]]

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 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.

[[Page S7661]]

  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 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

[[Page S7662]]

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 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

[[Page S7663]]

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 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.

[[Page S7664]]

  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 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,

[[Page S7665]]

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 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

[[Page S7666]]

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 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

[[Page S7667]]

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 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

[[Page S7668]]

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.
  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.

[[Page S7669]]

  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.
  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.

[[Page S7670]]

  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 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,

[[Page S7671]]

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 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

[[Page S7672]]

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 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

[[Page S7673]]

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 
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

[[Page S7674]]

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 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

[[Page S7675]]

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 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,

[[Page S7676]]

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 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

[[Page S7677]]

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.
  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

[[Page S7678]]

farmers at a competitive disadvantage 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 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

[[Page S7679]]

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 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.

[[Page S7680]]

  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 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

[[Page S7681]]

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 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.

[[Page S7682]]

  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 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

[[Page S7683]]

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 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

[[Page S7684]]

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.
  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.

[[Page S7685]]

  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 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,

[[Page S7686]]

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 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

[[Page S7687]]

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 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

[[Page S7688]]

     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.
  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.

[[Page S7689]]

  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 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.

[[Page S7690]]

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 PRESIDING OFFICER. 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 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.

[[Page S7691]]

  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 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

[[Page S7692]]

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 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

[[Page S7693]]

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-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

[[Page S7694]]

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 
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.

[[Page S7695]]

  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, 
headquartered 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 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.