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This letter was sent today to the members
of the Senate Finance Committee by Alan Reuther on behalf of the UAW.
It articulates our position on this trade agreement.
June 27, 2005
The Honorable Charles Grassley, Chairman
Senate Finance Committee
219 Dirksen Senate Office Bldg.
Washington, D.C. 20510
The Honorable Max Baucus, Ranking Member
Senate Finance Committee
219 Dirksen Senate Office Bldg.
Washington, D.C. 20510
Dear Chairman Grassley and Ranking Member Baucus:
On Tuesday, June 28, the Senate Finance Committee is scheduled to markup
the implementing legislation for the United States-Dominican Republic-Central
American Free Trade Agreement (CAFTA). The UAW urges the Committee to
reject this legislation because the CAFTA deal negotiated by the Bush
Administration unfortunately follows a pattern of failed trade deals that
have saddled our nation with a precarious trade deficit, escalating job
losses and stagnant wages.
The UAW objects to CAFTA because it fails to include strong, enforceable
protections for worker rights. The labor provisions in CAFTA are actually
weaker than the current labor conditions that apply to Central American
countries under our unilateral trade preference programs, the Generalized
System of Preferences (GSP) and the Caribbean Basin Initiative (CBI).
They are a step backwards from the labor rights provisions of the U.S.-Jordan
Free Trade Agreement, which passed Congress unanimously in 2001. Unlike
the Jordan agreement, CAFTA excludes the vast majority of its labor rights
obligations from the accord s dispute settlement and enforcement mechanisms.
Under CAFTA, only the requirement that countries enforce their own labor
laws is subject to dispute settlement and enforcement, but this is rendered
meaningless by the fact that CAFTA does not require countries to maintain
even minimal labor standards like child labor laws.
Moreover, CAFTA relegates violations of labor rights provisions to a significantly
lower status than violations of intellectual property and commercial rights.
Under CAFTA, only violations of the agreement s commercial provisions
can lead to trade sanctions or punitive fines. Labor rights violations
cannot lead to trade sanctions, and fines are capped at an arbitrarily
low dollar amount, without regard to the harm caused.
The current account deficit for the U.S. is a staggering $780 billion,
annualized from the first quarter of this year. The U.S. economy has lost
over 2.8 million manufacturing jobs since January 2001. Wages for American
workers are stagnant, while fuel costs spiral upward. These alarming facts
have been caused, in large part, by our failed trade policies, including
past flawed trade deals and the Administration s failure to address China
s manipulation of its currency, which undercuts our nation s ability to
export U.S.-made goods and unfairly lowers the cost of goods imported
from China.
In light of this mounting evidence, it would be a grave error for Congress
to repeat the mistakes of the past by approving yet another flawed trade
deal. Accordingly, the UAW urges you to oppose CAFTA when it is taken
up by the Senate Finance Committee this week.
Sincerely
Alan Reuther
Legislative Director
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