It was a disaster once, let's try it again!

I see that the battle around the Central American Free Trade Agreement (CAFTA) is heating up. CAFTA is a new trade agreement based on the fine example of NAFTA, and the usual suspects are beating the free trade drum. Apparently, CAFTA is the solution to drugs, unemployment, and even illegal immigration:

While CAFTA is the right thing to do for democracy, it is also the smart thing to do for U.S. security. We do not live in isolation from what happens in Central America. Criminal gangs, trafficking in drugs, even trafficking in persons, create dangerous transnational networks. When there is instability and poverty in our neighborhood, it is common sense to help our neighbors address those problems at home rather than import them into our own country.

It's interesting, though, to see that even the biggest boosters of CAFTA don't mention any safeguarding of labor or environmental rights. The so-called "side agreements" to NAFTA, which covered those areas, have been an unmitigated disaster for the decade plus since the treaty's signing. They are even more pathetic (pdf) under CAFTA.

CAFTA limits penalties for failure to enforce labor laws to $15 million – while sanctions for breaches of commercial provisions are unlimited. Fines will be given back to the country that fails to enforce its own labor laws.

And further (another pdf):

Under CAFTA, global corporations could sue taxpayers for cash damages if they feel that, for example, environmental or public health laws and regulations interfere with their profits. Under NAFTA’s similar provisions, several cases have already been brought by corporations challenging environmental protections. A Canadian mining company recently sued U.S. taxpayers for $50 million in order to avoid compliance with a California law protecting indigenous communities and requiring future clean up of the company’s mine site.

There seem to be a couple of political factors behind the drive to pass CAFTA. The first is the perception that CAFTA is a first step toward its big brother, the Free Trade Area of the Americas (FTAA), which would encompass all of North and South America and the Caribbean (except Cuba). The second is the feeling in Washington that if the US doesn't rope the Central American nations in to its economic grasp now, they will look to Brazil or Venezuela. And neither of those nations is likely to demand the draconian investment and property protections the multinational corporations demand. Especially with the recent victory for democracy in Mexico, there is some concern in Washington that our neighbor to the south might look with interest at some of the progress in South America:

Strong left oppositions are waiting in the wings in El Salvador and Nicaragua, which has recently seen unruly street protests over economic concerns and which has been politically deadlocked by a confrontation between a left-right alliance of convenience in its parliament and President Enrique Bolanos. Washington’s greatest hemispheric threat is that Central America will follow the pattern of much of South America and join a leftward turn that might take Mexico along with it.

At the moment, it appears that Bush does not have the votes to pass CAFTA, but I urge you to get ahold of your congressperson and urge her or him to vote against the treaty.

Finally, I leave you with an excerpt from an article from the Boston Globe, CAFTA Will Hurt People with HIV:

The office of the US trade representative maintains that nothing in the agreement prevents governments from producing generic drugs and that it will result in increased access to life-saving drugs as stringent patent protection encourages innovation in drug development.

The first of these claims is, unfortunately, false. CAFTA's protection for drug test data ensures that while countries may be able to produce generic drugs, they won't be able to use them. The second statement is partially true but so disingenuous that it verges on outright deception. Increased protection for patent rights will certainly give drug companies larger profits, and this could theoretically lead to more innovation. However, the pharmaceutical market in Central America is so small that any increase in earnings will be negligible relative to the overall profits of the pharmaceutical giants. Patients in Central America will most likely end up getting nothing in return for the higher prices.