CAFTA: Last Nail in the Coffin?

The American Conservative ^ | May 9, 2005 Issue | Patrick J. Buchanan

[A. Pole]

With U.S. prisons filling up with aliens, 10 million illegals here and counting, Californians fleeing east, savage Salvadorian gangs battling with machetes inside the Beltway, and Minutemen headed for the Arizona border, Rip Van Republican has awakened to the threat of open borders. Meanwhile, the White House dozes on.

But just as the chickens are coming home to roost on the Bush failure to defend America’s frontier, so they will soon be coming home on Bush’s embrace of free-trade fanaticism.

As I write, the Department of Commerce has just released the trade deficit numbers for February. Again, the monthly trade deficit set a record, $61 billion. In January-February 2005, the annual U.S. trade deficit was running $100 billion above the all-time record of $617 billion in 2004.

In the mail this week came the annual graphs and tables from Charles McMillion of MBG Information Services, who has patiently chronicled the decline and fall of the once-awesome U.S. industrial machine. Since 1992, when some of us urged the president’s father not to grant MFN to China, the returns are these:

• Between 1993 and 2004, the U.S. trade deficit with Beijing grew 700 percent to $162 billion.
• In the last decade, China’s total trade surplus at U.S. expense was $805 billion.
• China’s leading exports to us, which account for almost half her $162 billion trade surplus, came from shipments of computers, electrical machinery, and parts.
• Leading U.S. exports to China (Boeing alone excepted) were, in ascending order: meat, meat offal, fibers, ore, slag, ash, organic chemicals, fertilizers, copper, cereals, raw hides, skins, pulp of wood, cotton, and the big seller—oil seeds and oleaginous fruits (soybeans). All very, very high-tech stuff.

China’s surplus, the largest one nation has ever run against another, provides her with the hoard of cash to buy Russian and Western weaponry to menace Taiwan and the 7th Fleet and pile up the T-bills that give Beijing the leverage it enjoys today over the sinking U.S. dollar and shaky U.S. prosperity.

In the 1993 battle of NAFTA, the Clinton-Gore-Dole-Gingrich globalists predicted our trade surplus with Mexico would grow, Mexico would prosper, and illegal immigration would be easier to control. Either they deceived us, or they deceived themselves. For since NAFTA passed:

• The U.S. trade surplus with Mexico has vanished and the annual trade deficit is now running above $50 billion a year.
• The cumulative trade deficit with Mexico is now over $300 billion.
• 1.5 million illegal aliens are caught each year crossing our border and 500,000 make it in to take up residence and enjoy all the social programs a generous but over-taxed America can provide.

With Chrysler now a German company, GM and Ford down to less than half the U.S. auto market, and GM paper looking like Argentine bonds, Americans now import $188 billion worth of autos, trucks, and parts, three times what we export. Motown is no more king of the road.

With three million manufacturing jobs lost under Bush, the U.S. dollar looking like Monopoly money, trade deficits exploding, and our dependence on foreigners for oil, the critical components of our weapons, and the cash to finance our insatiable appetite for consumer goods all growing, one would think even Bush Republicans might pause before taking another great leap forward into a future of global free trade. One would be wrong.

For CAFTA, son of NAFTA, is at hand: the Central American Free Trade Agreement. The White House will bring it up, but only if enough Republicans can be bamboozled into going along. In return for access to our market, we get access to five Central American markets and the Dominican Republic—with a total economy the size of New Haven’s—47 million consumers, half of whom are living in poverty by their standards.

The highest per capita income in Central America is $9,000 a year in Costa Rica, which is less than the U.S. minimum wage. But CAFTA will enable agribusiness and transnational companies to set up shop in Central America to dump into the U.S. and drive our last family farmers out of business and kill our last manufacturing jobs in textile and apparel.

If there are any Reagan Democrats left still loyal to the GOP, CAFTA may see them off. For if the GOP passes CAFTA over Democratic opposition, Hillary’s party may just be able to take back North Carolina, Ohio, and a couple of bright red farm states as well.

[Dog Gone]

Go throw the stuff we import into the harbor and then you'll have a reasonable analogy. Removing the tariffs other countries impose on our exports is a good thing for us.

You can't get around that.

[Dog Gone]

Meanwhile our trading partners keep thier markets closed to our products as they develop their own high tech manufacturing infrastructure.

Then you should support CAFTA since it opens their markets to our products and services.

[hedgetrimmer]

Yes, the US should utterly destroy our sugar industry in order to "open markets" in an economy that is half the size of San Diego's economy. Let's not forget that even as we drop our tariffs, our trading partners do not always drop theirs. Take China for instance.

[Dog Gone]

Perhaps we should enter into a free trade agreement with China which forces them to drop tariffs, as CAFTA does.

[1rudeboy]

Can't try to expand markets for U.S. business. Nope. Never. What would people think? Trying to better oneself is so over-rated.

[eskimo]

Can't try to expand markets for U.S. business. Nope. Never. What would people think? Trying to better oneself is so over-rated.

LOL. I think the problem arises when those who are addicted to profiting trod on the rights of others to satiate their blind obsession.

[1rudeboy]

Trying to make a profit violates your rights. Cute.

[A. Pole]

Trying to make a profit violates your rights. Cute.

Very often it does. You are confusing profit with the Divine sanctification. Money god is a false idol.

[eskimo]

Trying to make a profit violates your rights. Cute.

What are saying; that never happens? Don't the people of this country have a right to have the Senate ratify trade treaties? Don't the people of this country have a right to expect Congress to regulate trade in their best interest? Where, in hell, do you live; what gods do you worship?

[hedgetrimmer]

Can't try to expand markets for U.S. business

Who is doing the expanding? It is the federal government, unconstitutionally using taxpayers money to build infrastructure in foreign countries so certain corporate interests do not have to risk their own capital. Why don't the corporations go into these countries and upgrade the infrastructure on their own if its so important? Why must the US taxpayer and American citizens pony up for you guys when all we get in return are shut down industries, soaring tax bills and loss of rights and representation? The fact that tax money is being invested in foreign countries to benefit the foreign governments and few global corporations is unconstitional and unAmerican. But it is socialist and globalist, and that pegs you and your opinions pretty well.

[A. Pole]

Money god is a false idol.

My impression is that material gain is as sacred to the freemarketeers as abortion and pederasty is to the liberals.

[hedgetrimmer]

My impression is that material gain is as sacred to the freemarketeers

You might want to add: as long as the United States taxpayer assumes all the risk for that gain and takes none of the profit.

[jpsb]

"Then you should support CAFTA since it opens their markets to our products and services."

At some point all credability on the issue of trade is lost. The Bush Administration passed that point when they told us how out sourcing our jobs was good for us. I no longer believe anything the GOP has to say on trade. The after 12 years of Globalist (GOP) domestic policy the country is just about ruined, huge trade deficits, huge budget deficits and millions of new illegals every year. Jimmy Charter would be proud. Time for a change in government.

[hedgetrimmer]

Trying to make a profit violates your rights.

It does when you use my tax money to bribe foreign govenrments into making trade agreements that shut down US industry and give the profits over to handpicked corporations.

[Havoc]

"Removing the tariffs other countries impose on our exports is a good thing for us."

How? How does it help us if by dropping import duties people in other countries still have to pay much more for American products than their own. If they can't afford it in the first place - tariff or no tariff is immaterial. In theory, I'd say you're right. In practice, it's quite another matter. Our products are far more expensive because of our cost of living.
You can't get around that. You also can't get around the fact that even with dropping tariffs, our deficits have grown enormously because, once again, our products even without tariffs are far more expensive. So for the good of a very few getting rich here and there, the entire country is being beaten upon. Remember, Paybacks are a _____________!

[Havoc]

The King said something similar to the colonists.. guess who lost.

[Dog Gone]

Our products aren't necessarily more expensive. Take food for example. Our ranchers are far more efficient at raising meat and poultry than the other CAFTA nations.

Ever tried to get a good steak south of Texas? It's pretty hard.

Ever tried to buy turkey in Costa Rica? It's not even there.

CAFTA will change all that.

Many of our exports have no local competition. Yet they're hit with high tariffs. Things like washing machines and refrigerators. Computers. CAFTA will lower the prices for their citizens by removing those tariffs and making them more affordable for their citizens. As a result, we'll be able to sell more of them.

It also allows US companies to compete in areas which are currently government-controlled monopolies in those countries. Companies like Cingular and Verizon will be able to compete for the growing cell phone market for the first time. Private insurance companies will be permitted to write policies.

CAFTA opens up their markets to American exports and competition. The CAFTA nations will benefit, and so will we.

[Havoc]

Bunk. The only thing Cafta will change is it will make it even more likely that domestic industry will have to shut down while all the protections against it are removed. It's what the King of Britain did to the colonies. By removing the protection of tariffs, the King could dump imports onto the market of colonial America and corner the market on those products - bringing in vast profit. The end result of that was the declaration of independance. And now our politicians have seen fit to play King. Some people just draw the wrong lessons from history. The people are long suffering; but, they aren't stupid - hence our founders. As far as I'm concerned, if you're a free trader, you're a redcoat.

[1rudeboy]

Don't the people of this country have a right to have the Senate ratify trade treaties?

You have a problem with our Senate having the power to grant fast-track authority? Perhaps you should re-read the Constitution before yelping about "rights."

[1rudeboy]

Please develop that analogy. Please.