First NAFTA, Now CAFTA?
In 1993, the U.S. government passed the North American Free Trade Agreement (NAFTA) with Canada and Mexico, promising it would promote jobs. In reality, according to Sarah Massey, a spokesperson for the AFL-CIO Americas Union Movement, it lowered wages, heightened unemployment and increased pollution. Massey now argues that the proposed Central American Free Trade Agreement (CAFTA) is “going to be a failure just like NAFTA.” She adds, “It also isn’t going to change the substandard working conditions, child labor laws or environmental regulations of Central America. This agreement will only help large corporations, not the people.”
Currently, CAFTA contains no provisions to compel Central America to meet America’s labor and environmental standards, or to adopt a set of basic standards. As the Citizens Trade Campaign reports, “Seventy-five percent of Central America’s population lives in conditions where pollution of both air and water and depletion of water have resulted in increased violence and diminishing public health standards.”
Rachel Ackoff of the Sierra Student Coalition Fair Trade Campaign at Swarthmore College has been leading students to contact their Congress representatives to encourage them to vote “no” on environmentally destructive free trade agreements. “The most frightening part of the proposed agreement is an investor provision that would allow corporations to sue foreign governments if they pass any environmental regulation that could threaten their future earnings,” Ackoff explains. “This might force the nation to pay damages to the corporation if it chooses to protect the environment.”
CAFTA has already been signed by the U.S., El Salvador, Nicaragua, Guatemala, Honduras and Costa Rica, but for it to be implemented each country has to hold an official vote. Protests leading to police violence have occurred in El Salvador and Guatemala, where workers marched to stop their governments” approval.
The U.S. Commerce Department and the U.S. Chamber of Commerce are holding a series of pro-CAFTA events in U.S. cities such as Charlotte, North Carolina, where previous trade agreements caused job loss. Currently, North Carolina has more than 50,000 recipients of federal benefits for workers who can prove they lost their job as a result of NAFTA.
The PR firm Summit Communications, which promotes CAFTA, argues, “Enactment of CAFTA between the U.S. and five Central American nations will benefit both regions by encouraging multilateral trade and forging new commitments on labor rights, providing the participating nations with a firm base on which to build stronger economies.” The agency says, “The process is expected to accelerate the pace of political and economic reform in each of the member states,” and it claims the agreement is needed in the face of globalization and will “raise income levels and increase social wellbeing.”
Since NAFTA’s implementation the U.S. has lost more than 765,000 jobs according to the Stop CAFTA coalition. In Mexico manufacturing wages fell, causing the number of people living in poverty to grow, reports the coalition.