Parent Category: News
On Thursday, June 30th, the House Ways and Means committee voted 24-11 in favor of the United States-Central American Free trade Agreement ( C.A.F.T.A) setting the stage to ship the few remaining high paying manufacturing jobs in this country off to Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, or the Dominican Republic.

Evidently, the manufacturing capacity of the rest of the third world has been reached and various multinational manufacturers are scrambling to find other places in which to increase capacity. Either that, or they are tired of having to pay the outrageous wages demanded by those workers in China, Vietnam or Mexico, some of whom are getting as much as 50 cents an hour. Also, the staggering demands made by environmentalists have forced these billion dollar businesses to actually provide out door privies and almost potable drinking water to their employees. These very same ungrateful employees have never even thanked these companies for pulling their 10 and twelve year- olds out of their make shift school rooms and providing them gainful employment 12 hours a day, six and a half days a week with no benefits at all. Ingrates!

Local hero to all working class folks, Representative Tom Reynolds ( R ) has repaid those who re-elected him last November by voting for the measure, thus ensuring that even more jobs are sent out of New York. Those who may remember Mr. Reynolds coming out to support the Niagara Falls Air Force Base should be reminded that he voted to close that very same base last year. That being said, I’m sure that Mr. Reynolds will be returned to office quite handily in ’06. After all, why the hell would you want Jack Davis protecting your best interests in Congress when you can have Mr. Reynolds selling you out to his corporate sponsors??

The Bush administration has placated its friends in the sugar industry by promising to keep resulting sugar imports below a certain level. This would be

accomplished by paying CAFTA countries not to ship sugar into the U.S., or by buying any surplus CAFTA imports and making it available for conversion into nonfood uses, such as ethanol. Representative Mark Foley (R), Florida, initially voted for the bill in the committee, but is now hinting that he will oppose it on the house floor unless the Bush Administration sweetens the existing sugar deal. This raises the art of corporate welfare to a new level.

Democrats complained that the CAFTA bill is not tough enough when it comes to enforcing Central American labor laws, if indeed any are in place at all. The Bush administration came to the fiscal rescue, promising to supply 160 million dollars over the next four years to help CAFTA countries enforce labor and environmental law. Thus allowing them to look good to their constituents while financing the probable doom of the remaining American manufacturing concerns.

Central American leaders are banking on the hope that CAFTA will “give everlasting life to their regions growing industrial sector, including textiles…and help the region compete with China’s growing worldwide influence”. Competing with China will no doubt lead Central American manufacturers to drive wages lower, eliminate or curtail existing benefits, and toss any costly environmental laws out the factory floor window, The already fragile ecosystem will take yet another hit.

Guatemalan businessman Dionisio Gutierrez, who owns a Guatemala-based fried chicken chain which operates restaurants in the United States and plans to expand into China, has declared that hundreds of leaders and politicians have started a campaign to win votes in the upcoming fight on the floor of the US congress.

The Bill goes to the full House floor for passage after the Fourth of July recess, and the vote is going to be hard fought and close.

Not everyone in the House of Representatives is happy about this bill. Many congressmen, with their eyes firmly on mid term elections next year, have to worry about their folks back home who have fallen victim to outsourcing or lost high-paying manufacturing jobs. They might get an ear full. Then again, a renewed debate over Supreme Court nominees and Roe v. Wade could be just the tonic for displaced workers and their sour grapes. Praise the Lord!

So called free trade statistics are far from encouraging. The U.S. trade deficit in 2004 was a staggering $617 billion dollars, and CAFTA will certainly contribute to its growing ever larger. American manufacturers have lost upwards of two and a half million jobs since the passing of similar North American Free Trade Agreement in 1994. NAFTA allowed duty and tariff free imports to Mexico and Canada, and CAFTA will do the same for Central America. The remaining 14.5 manufacturing jobs here at home are now at risk. In 1993 we had a 1.6 billion dollar trade surplus with Mexico, we now have a whopping 45 billion dollar trade deficit with this country. Working conditions just south of the border are third- world at best, with the lowest wages possible, horrendous working conditions and environmental devastation.

Ironically, China has begun to invest in Central American textile manufacturing, as they make an attempt to buy their way into American Oil company supplies via Conocal of California. CAFTA is not popular with everyone, Carlos Reyes, an anti CAFTA organizer, declared that the measure will “add more than 1 million people to the unemployment rolls in Honduras and it will increase the “informal economy”, Crime, and the massive migration of workers to the United States.”

But the Bush administration and its multinational companies who bank roll it disagree, and they will do everything they can to force the House to vote for approval.

If they succeed, the results will be disaster for the poor of Central America, and huge profits for multinationals with little concern for their powerless employees.

Quick trip down memory lane...

In November of 1993, the US reached an agreement with Canada and Mexico that would create the largest Free Trade Zone in the world, bringing 360 million consumers and $6 Trillion Dollars under the same roof called NAFTA. This high hope agreement made promises of increased jobs and prosperity for all three participating countries. Mexico in particular became the country in question, as it seemed more like an American story book fantasy that NAFTA would help Mexico to grow up big and strong and be just like the US someday. Despite, the arguments from both side of the border, proponents of NAFTA insisted that Free Trade would bless Mexico with it’s own Middle-Class,economic and social stability and improved environmental and health conditions. It all sounded good on paper.

To the rest of America, it sounded like American jobs packing up and leaving thousands of workers in the unemployment line. A similar fate awaited Mexico’s Peasant Farmers and businessman whose buying and selling power would be dwarfed by their new American competitors. While Mexico’s exports of Farm products did see a $4 Billion Dollar increase under NAFTA, Tens of thousands of protesting farmers said that the main beneficiaries were large, corporate farms.

In the end, after only one year NAFTA resulted in 1 million Mexicans jobs lost due to a devalued currency and the privatization of ports, railroads,airlines, mines and other industries. Over the next 10 years export-industry wages remained flat, while other industry wages dropped at an annual rate of 0.2 percent as the new private owners turned union contracts upside down. So much for that Middle-Class. All of this loomed under $13 billion in environmental, health and safety violation lawsuits.

But that was then. This is now. NAFTA is old news. Now we have CAFTA. Same scenario, same promises. New players. This time it’s El Salvador, Honduras,Nicaragua, Guatemala and Costa Rica. The returning player to this game is, of course, the US. And history is already repeating itself. Massive protests have already begun, alleging that CAFTA will eradicate local agriculture and production of medicines while opening exclusive doors for US Multinationals.

Several of these protests have resulted in tragedy. Guatemala in particular has already seen demonstrators killed, wounded or injured by rubber bullets fired by police officers. Two journalists, Marielos Monzon and Gabriel Mazzarovich, have had their lives threatened for their reports on the protests. One of the threats came from Monzon’s own house, with the anonymous caller insisting that she “stop defending those stinking Indians you bitch or we will kill you.” El Salvador has already pushed forward with privatizing their healthcare system, resulting in its own protests.

An overwhelming number of these protests involves union workers, teachers, and peasant farmers, just like in Mexico over 10 years ago. And similar to Mexico, our Nations lawmakers are claiming opportunity and economic growth for the participating countries.


The Central American Free Trade Agreement (CAFTA) is a regional agreement between the U.S. and five Central American countries: Guatemala, El Salvador, Honduras, Nicaragua, and Costa Rica. The Dominican Republic was docked onto the agreement in March 2004. CAFTA is expected to be brought before Congress sometime in 2005,


Human rights organizations in both the U.S. and Central America have been vocal in their criticisms of CAFTA. Worker’s rights in Central America are far below international standards and workers there are often plagued by discrimination and abuse. The CAFTA model is deeply flawed in its design as it allows substandard and un-enforced labor laws to be accepted as the standard. Instead of conditioning trade benefits on compliance with international workers rights standards, the CAFTA agreement has no meaningful protections for workers.


According to Human Rights Watch, the Ministry of Labor in El Salvador violates its own inspection procedures, ignores the anti-union conduct of employers, and impedes workers’ right to freedom of association. The report finds that the Ministry fails to uphold labor laws, and that these laws contain countless loopholes allowing employers to violate worker’s rights without consequence.

Unfortunately, these violations are not unique to El Salvador, rather they are endemic to the region where attacks on labor organizers in countries like Guatemala have at the most extreme level included torture and murder. CAFTA would undermine working conditions in both the U.S. and the Central American region by ignoring enforcement of worker’s human rights and encouraging competition among countries with faulty labor standards in a veritable grace


Export Processing Zones (or EPZs) where maquila factories operate are already prevalent throughout Central America and would expand dramatically under CAFTA. EPZs are areas where goods can be imported and assembled for export without normal duties, and are known for their human rights abuses in what are often sweatshop factory conditions. Most of the clothing produced in the region already takes place in EPZ where foreign companies hire mostly women aged 15-25 to provide cheap labor under poor working conditions.iii Women and girls working in the maquiladora sector in Guatemala, though theoretically protected under the law, encounter persistent discrimination. Guatemalan maquiladoras, many of which are suppliers for well-known South Korean and U.S.-based corporations, discriminate against women workers in a number of ways—including requiring women to undergo pregnancy tests as a condition of employment; denying, limiting, or conditioning maternity benefits;denying reproductive health care to pregnant workers; and, firing pregnant women. .


Though each of the five CAFTA countries is unique, they are all developing economies and most are faced with the enormity and complexity of confronting significant poverty levels. Rural areas in particular, present challenges to sustainable development where 60% of Central America’s poor reside and where small-scale producers rely on highly volatile agricultural markets. In Guatemala and Nicaragua, agriculture employs 60 and 44 percent of the economically active population, respectively.v For small-scale producers, agriculture remains central to life and livelihood, and trade agreements like CAFTA, employed without safeguards for small farmers or essential foodstuffs, would make rural populations extremely vulnerable to increased poverty and malnutrition. .


This agreement would lock participating countries into overly restrictive intellectual property protections for big pharmaceutical companies. Under CAFTA, countries would be forced to extend pharmaceutical patent terms beyond the 20 years required in World Trade Organization (WTO) rules, prevent the marketing of generic medicines if a patented version of the product is registered, and restrict the use of original pharmaceutical test data for the registration of generic medicines, a restriction referred to as "data exclusivity."vi One analysis of such patent rules conducted in Costa Rica revealed that the new policies could increase the cost of medicine by as much as 800%.vii


Services that help meet peoples’ right to food, education, health and basic utilities should be exempt from trade rules. Currently, however, domestic regulations on essential services could be considered “barriers to trade” under the CAFTA agreement and open to challenges by multinational corporations. CAFTA could also require governments to bid out for certain services, essentially privatizing much needed public services, resulting in prohibitive price increases, reduced access and compromised quality. The loss of governments’ ability to provide accessible essential services would severely impact the most vulnerable in our society, including the poor, children, and the elderly. Women would also be impacted disproportionately as they are often primary care givers and rely heavily on public services. By Grady Hawkins

The long Fourth of July holiday weekend has passed, and Americans gathered all across this great nation to celebrate the fact that a handful of unethical American lawyers, smugglers, and pirates stole an entire country from an incompetent British government. Independence day is here yet again, and I for one doubt that the founders and framers would recognize into what their American experiment has evolved. The Bush administration and its cabal of corporate cronies are busy at work undermining the middle class and reducing this country to an economic third world backwater.