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Senate Gives OK to CAFTA

posted on July 1, 2005


Hello, I'm Mark Pearson.

Congress got busy this week, just ahead of its Fourth of July holiday break.

First, the Senate finally approved long-simmering energy legislation that has a lot of impact on farm country. The measure includes a doubling of the ethanol mandate by 2012 ... a tax credit for development of alternative fuels ... and an extension of biodiesel tax incentives. The next step is a conference committee, where lawmakers will work out differences between the House and Senate versions of the bill.

The Senate also acted this week on a dicey trade issue ... the Central American Free Trade Agreement, or CAFTA. Like its free trade predecessor NAFTA, the trade deal is unpopular with some farm state interests, especially those in sugar-producing areas.

But the White House is fighting hard for Congressional approval and apparently ready to make concessions to see that it happens.

Senate Gives OK to CAFTA CAFTA advocates received positive news this week following Senate passage of the controversial trade deal. Backed by several new supporters, the CAFTA measure moved through the Senate Finance Committee prior to Thursday's vote.

The trade deal legislation was buoyed by a series of Bush administration concessions offered to ease anxiety over sugar imports and labor rights. Changes include $160 million over four years to uphold environmental and labor laws. Another $150 million in farm subsistence for Central Americans is being proposed to soften criticism by CAFTA opponents. Challengers to CAFTA claim that inexpensive U.S. food imports could destroy Central American farmers.

Supporters counter that the agreement would help U.S. investors and reinforce intellectual property rights.

Those claims fell on "deaf ears" with the U.S. sugar industry, which argues CAFTA could damage profits. The American Sugar Alliance stated that a Bush administration concession for a pilot program on sugar-based ethanol is inadequate.

Following Senate approval, the House could consider the CAFTA legislation in July.


Tags: agriculture government Latin America news trade