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House passes DR-CAFTA in long, close vote

The House passed the Dominican Republic-Central America Free Trade Agreement by a vote of 217-215, a much closer margin than anticipated by some participants in the 19-month-long fight to win approval for the accord.

The vote, which was held open past midnight on June 27, could have gone either way, according to interest groups following the DR-CAFTA debate. But a spate of last-minute backroom deals and personal appeals by President Bush and Vice President Dick Cheney appeared to turn the tide for supporters.

The Senate earlier passed the agreement by a vote of 54-45. It now goes to President Bush for his signature.

The agreement will “level the playing field,” supporters said, for U.S. farmers who face stiff tariffs in the Central American countries – Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua and the Dominican Republic – while their exports enter the United States duty-free under previous trade pacts.

“The agreement eliminates barriers to our producers and greatly improves our competitiveness in these markets,” Agriculture Secretary Mike Johanns said in a statement issued after the vote. “These are natural markets for our producers and new access will offer many new business opportunities.”

In the end, most major farm organizations supported the agreement, while the more liberal-leaning National Farmers Union and some textile manufacturers organizations opposed it.

The National Cotton Council, one of the last groups to support DR-CAFTA after the administration made changes that lessened its impact on U.S. textile manufacturers, applauded its passage.

Council Chairman Woods Eastland, a cooperative official from Greenwood, Miss., said the agreement was a significant step for U.S. cotton in its effort to remain competitive, especially domestic textile manufacturers who, he said, now have a platform to compete with China.

“I want to express our appreciation to all Cotton Belt Congressional members who carefully listened to their constituents and voted to approve the agreement, which will preserve jobs by enabling the U.S. cotton industry to maintain and expand a 2.7-million-bale market,” he said.

The NCC was an active participant in a coalition of 10 textile and apparel trade associations as well as the Ag Trade Coalition and Business-Coalition for U.S.-Central America in working for DR-CAFTA passage.

Not all members of the textile-manufacturing sector shared those sentiments, however. Calling it a “sad day for the U.S. manufacturing workforce,” the American Manufacturing Trade Action Coalition expressed its gratitude to members of Congress who opposed DR-CAFTA.

“We regret the outcome of the vote, noting that the defeat of CAFTA would have been the first step to rectifying America’s devastatingly flawed trade policy that has cost the country nearly 3 million manufacturing jobs over the last five years,” said AMTAC Executive Director Auggie Tantillo.

Much of the textile manufacturing opposition to DR-CAFTA centered on concerns that the lack of strong restrictions would enable China to use the Central American countries as a platform for circumventing U.S. safeguard restrictions on Chinese textile and apparel products.

But Republican leaders reportedly secured more votes for CAFTA by agreeing they would introduce legislation that would allow the U.S. government to impose duties on exports from China and other countries designated as “nonmarket economies” by the Commerce Department.

The legislation, which was introduced earlier in the day on July 27, passed the House by a 255-168 vote. Senate Minority Leader Harry Reid of Nevada called the bill a “sham,” vowing to fight it when it reached the Senate.

Labor organizations also opposed the measure, claiming it offered little protection to Central American workers whose low wages and lack of benefits give manufacturers in those countries an advantage. Nor did it address environmental issues, the groups said.

Other farm organizations hailed the vote.

“We thank all members of the House of Representatives who voted for passage of this agreement,” USA Rice Federation Chairman Lee Adams said. “We especially acknowledge the representatives from rice-producing states whose votes were critical to the passage of the agreement.”

Noting that DR-CAFTA would immediately eliminate tariffs on all soybeans and soybean products with the exception of refined soybean oil, American Soybean Association President Bob Metz said the agreement will also “benefit U.S. livestock and poultry producers. It provides the United States with sizeable quotas for exporting pork duty-free. These quotas will increase each year until they are eliminated in year 15.”

Some of the loudest praise came from the American Farm Bureau Federation, which supported the agreement almost from its initial signing by the Central American countries in December 2003.

“Hard work and common sense prevailed today with the House’s passage of the Central American-Dominican Republic Free Trade Agreement,” said AFBF President Bob Stallman. “Albeit a long and winding road to its success, the American Farm Bureau Federation traveled the distance to secure economic growth and security for U.S. farmers and ranchers while expanding our opportunities globally.”

The Farm Bureau’s estimate that DR-CAFTA would mean an increase of $1.5 billion per year in agricultural exports to the region were among the benefits most often cited by proponents of the measure during the long debate.

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