CAFTA - GOOD, OR BAD?

The U.S House of Representatives passed, just barely, (by a 217-215 margin) the Central American Free Trade Agreement (CAFTA) in a hotly debated vote that went almost completely along party lines (Only 27 Republicans voted against it, while only 15 Democrats supported the agreement).

Since the Senate had already passed the measure by a vote of 54-45 back in June, President Bush was able to sign the agreement into law, and quickly did so, perhaps providing U.S. exporters and workers a great reason to rejoice. Or did it?

Nancy Pelosi and the leftists in Congress hysterically opposed CAFTA (the left is drawn to hysteria like mice to cheese - but I digress) which put them in agreement with Fidel Castro, Hugo Chavez, Daniel Ortega and other Marxists in Latin America; this is par for the course.

Interestingly, Pat Buchanan and other “Paleocon” conservatives were on Castro’s and Chavez’s side on this issue and should make you look upon the matter with jaundiced eye.

On the other hand: "That CAFTA almost lost and passed with a tiny two-vote majority is due to the oddest combination of demagoguery witnessed in Washington for some time," according to Neal Asbury. ("Neal Asbury, President of Greenfield World Trade, is an experienced international business man who has spent the greater part of his life in Asia and other locales.")

So why did the lefties oppose CAFTA?

One of the biggest reasons given for their opposition to it was the purported loss of jobs in the United States that would take place with the passage of CAFTA. Mr. Asbury feels, "The only ones that should be worried about losing jobs are the Chinese."

Why?

Well, he notes:

The jobs that will be created have long left the United States and are not coming back. However bringing back these jobs to our neighborhood, to countries with many more shared interests with us, such as democracy and peace in our hemisphere, is an incredibly positive thing.

CAFTA will create a favorable environment by providing legal protections and due process that is not part of the China investment landscape that could move production of textiles and other consumer goods closer to home.

Logistic costs and transit time are also much more advantageous. A shirt that says “Made in Guatemala” is likely to contain more than 65% U.S. content whereas a shirt that says “Made in China” has none.

We shall see. But if I were a betting man, I would take the opinion of someone (like Asbury) who has spent most of his life overseas in the capacity of an international businessman and sales consultant before I would rely on the opinion from the "Queen of Botox".