Reject Flawed CAFTA, Union Leaders Tell Congress

The proposed Central American Free Trade Agreement (CAFTA) is seriously flawed and should be rejected, AFL-CIO leaders told two congressional committees in recent testimony. The pact, which does not include adequate protections for workers’ freedom to form unions or safe working conditions, would not alleviate poverty in Central America and would cost thousands of U.S. workers their jobs, they said.

“Instead of improving things, CAFTA will further oppress workers, depress wages in Central America and cost jobs in the United States,” AFL-CIO Executive Vice President Linda Chavez-Thompson told the House International Relations Subcommittee on the Western Hemisphere April 13. “The deal will do nothing to pull people out of poverty in Central America, and it has the potential to plunge workers further into exploitation.”

“CAFTA is not the answer to the challenges faced in Central America or the United States,” added AFL-CIO Secretary-Treasurer Richard Trumka in his April 21 testimony tp the House Ways and Means Committee. 

Trumka told the committee that CAFTA “represents a failed model that will likely exacerbate poverty and inequality in Central America, while further eroding good jobs and wages at home. 

“At the same time,” he said, “its excessive protections for multinational corporations would undermine the ability of governments to protect public health, strong communities, and the environment.”

Workers’ Rights Not Protected

CAFTA is President George W. Bush’s top trade priority. If approved, it would extend to Central America and the Caribbean the disastrous job losses, increasing inequality and widespread environmental damage caused by more than a decade of the North American Free Trade Agreement (NAFTA).

U.S. workers lost nearly 1 million jobs due to growing trade deficits with its NAFTA partners during the past 11 years, according to the nonprofit Economic Policy Institute. During the same time, real wages in Mexico actually fell, while the number of people 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 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 aircraft, autos, apparel and consumer electronics.

A new AFL-CIO report released April 4 showed that CAFTA contains even weaker worker protections than previous agreements and would eliminate enforcement tools currently available in other trade programs. According to The Real Record on Workers’ Rights in Central America, 40 percent of Central America’s workers earn less than $2 a day, and workers’ rights are routinely abused in the region.

Release of the report coincided with growing grassroots and political action against CAFTA.  On April 20, nearly two-dozen Senate and House members from both sides of the aisle joined 23 business and labor groups at a Capitol Hill press conference to speak out against CAFTA.  On April 13, millions of working Americans across the country took part in a one-day call in to their Representatives to voice their opposition to CAFTA.

These actions reflect America’s increasing dissatisfaction with the failed trade model that CAFTA replicates.  Polls show that America’s working families feel that NAFTA was bad for the United States and that they want worker and environmental protections included in trade deals.  A March 1 survey conducted for Americans for Fair Trade showed an overwhelming 74 percent polled oppose CAFTA when asked if they would favor or oppose the agreement if it reduced consumer prices but caused job losses.