Stop CAFTA from exporting more of our economy

KERRY: What's frustrating to all of us here is that, you know, this is not -- is that we've been talking about this. We've been pleading with people to listen to us over the course of the last years. And there's just been this sort of deaf ear, "We know better. We're on a course."

And you know, for five or ten years, these things have been compounding. And it's going to be that much harder now to try to get back. But let's get to sort of some of the specifics.

I asked you specifically about Mr. Allgeier's comments to us about the 2003 standard.

PORTMAN: Right.

KERRY: And it hasn't changed. Why now is it OK?

PORTMAN: Well, and I took some notes from your earlier comments. And I will be able, if confirmed, to give you more specifics. Let me tell you what I know at this point.

First of all, when those comments were made in 2003, those countries had not undergone the process of looking at their own laws and trying to upgrade them. Some countries have, and you indicated some have and some haven't.

My understanding is, during that interim period, the International Labor Organization, the ILO, has actually visited those countries and issued a report indicating that the basic core standards have now been met.

Now, this is all about enforcement, as you said earlier. You can have the laws on the books -- and they have been improved -- but we need to be sure that those laws are actually enforced. I will be able to, again, give you more information on this, more precisely if I'm confirmed.

But my understand is that we have an opportunity, as we did last year with a $20 million appropriation, to improve capacity building in Central America and the Dominican Republic through the Central American-Dominican Republican Free Trade Agreement.

I think that would be a positive aspect of what we would do, not only to see improved laws on the books -- and you listed some of the concerns, some of the labor rights concerns -- but actually to have the United States help to ensure that there are inspectors.

I'm told that it, Senator Kerry, it's to the point where there are inspectors in some of these countries but they literally don't have transportation to be able to go out to do the inspections. So to help them to enforce their laws.

KERRY: But the laws themselves have, in fact, not been changed in most of those countries. In fact, the USTR has been touting a number of those laws, the reforms made in the past decade, particularly Costa Rice in '93, Dominican Republic '92, El Salvador '94, Guatemala '92 and again in 2001, and then Nicaragua in '96.

But each and every one of those major reforms didn't come about because of the political will of the country. They came about precisely as a direct outcome of the GSP which controlled. Now, GSP allows for members of the public to file a workers' rights petition based not just on the failure to enforce the law but also the adequacy of the laws. That tool is eliminated if CAFTA passes.

So in its place, we're only going to be able to condition trade benefits on the enforcement of a country's labor laws, no matter how inadequate they are, and they are, by everybody's measurement. And the only recourse we're going to have is non-punitive fines before the withdrawal of trade benefits could be threatened.

So we're, in effect, going to move to a weaker workers' rights enforcement mechanism of the CAFTA, and we'll lose the GSP petition process and go backwards. So if our goal is to improve workers' rights in the regions, why would we eliminate the one tool that's been proven effective?

PORTMAN: Well, I think it's positive that we graduate these countries out of GSP. And I think you probably share that, if we could bring them into a free trade agreement, GSP would...

KERRY: But only if you have the mechanism for enforcement. If you don't, it's not positive.

(CROSSTALK) PORTMAN: ... and you're right. If they don't continue to uphold their laws -- and there's a maintenance provision, as you know, in the legislation that would be sent to the Congress -- there are fines.

And again, I will get back to you, Senator Kerry, very specifically on this -- my understanding is that ultimately, after those fines are in place, and if there still is not the adherence to this maintenance requirement, then there could be trade sanctions. And those trade sanctions, obviously, would be a big stick, because the whole reason these countries are interested in entering into this agreement is that we do have enhanced trade between our countries.

So I do think that there is some more enforcement behind that, but I will certainly look into that.