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Columns

Editorial: Much Ado About CAFTA

By Don Hegland
August 4, 2005

CAFTA is the dawn of a new era in profitable trade! CAFTA is the end of civilization as we know it! Everything between these extremes has been rolled out to persuade Americans to demand support or defeat of the Central American Free Trade Agreement. CAFTA has been called everything from a "sweet deal for big sugar" to "the American way." Passed by the Senate, it is sure to be a contentious issue in the House.

CAFTA would create a free-trade zone by eliminating most tariffs and other trade barriers between the United States and six Central American countries. Proponents of CAFTA say it will boost trade, decrease illegal immigration, stabilize Central American governments, and reduce the $2.3 billion U.S. trade deficit with the region. Opponents argue that it will cost jobs in the United States, impinge on workers' rights in the region, and do little to close the trade gap.

One fact missing from the predictably inflammatory debate is that people everywhere want to improve their standard of living. Many people on this planet still live and die without ever knowing that things we take for granted-for example, refrigeration and indoor plumbing-even exist, let alone that ordinary people can actually have them! Global communication and travel are changing that. People who have been isolated or tyrannized for multiple generations are learning that there is a better life and they would like to have it, for their children if not for themselves.

CAFTA represents a means of achieving that goal. Recent saber-rattling by the Chinese military leadership notwithstanding, one need look no further than Taiwan to confirm that civilized people increase their standard of living in large part through trade with other civilized people. This has never been expressed better than by the credo held by the late Robert L. Bartley throughout his tenure as editor of The Wall Street Journal: "free markets, free people."

"It's probably one of the most frustrating trade bills, because it's the easiest to vote yes to," says Rep. John Shimkus, D-IL. "There really are no good arguments to vote no." On the other hand, John Sweeney, president of the AFL-CIO, blames NAFTA for the loss of U.S. manufacturing jobs, and says that lawmakers who support CAFTA will be held accountable.

Writing recently in The Wall Street Journal, Henry M. Paulson Jr., chairman and CEO of Goldman Sachs, says the fundamental question is will the United States continue to lead and help pave the way through open markets to create new jobs and growth?

Adopting CAFTA as it stands today is not necessarily inevitable, of course. But something akin to CAFTA will ultimately be adopted precisely for the reason-free markets, free people-so clearly elucidated by Bartley. All the rhetoric is just much ado for the sake of posturing.

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