Saturday, July 30, 2005

Who Likes CAFTA?

Now that CAFTA has passed, we must begin to speculate on the actual effects of the legislation, rather than merely the political battle that took place before its passing.

We must look at the trade opportunties presented in the deal. These countries do not represent the magnificent consumer base that was tapped with NAFTA. On the opposite side, they do not offer the same kind of threatening competition to certain American businesses that Mexico and Canada did. In fact, what we realize, after examining CAFTA, is that the only people who had a real cause for concern were the members of the sugar industry. However, they should not feel threatened anymore because their potent lobby in congress has turned what was supposed to be a free trade bill into what many consider a boondoggle.

According to Mercola, the sugar industry is presently protected by import quotas that inflate the prices of American sugar almost $2 billion a year. In fact, in order to get the bill out of committee in the senate, the legislation had to include subsidies to ethanol producers who buy U.S sugar as feedstock. The lobby fought the efforts of Congress to raise the quotas by 1% on foreign sugar, and succeeded.

Interestingly enough, the Bush administration continued to pursue CAFTA despite the anti-trade provisions in the bill. And why not? To most of the public, the president has won a major battle and combatted protectionism. Most people do not know of the pork barrel projects doled out to senators such as Kit Bond (R-MO), who will receive a $1 billion dam on the Mississippi River. Elizabeth Dole (R-NC) had provisions written in for textile mills in her state. This blog does not doubt that it was payday for many a "doubtful" congressman on the eve of the vote.

For intelligent analysis of the pork barrel deals, go to Infidel World.

3 Comments:

At 9:03 PM, Blogger Mr. Snitch said...

I suppose I could get called out on this, but the mention of "ethanol" to me just brings up bad memories of the energy-clueless 70's. It's not that we have better energy leadership now, but we do have emergent technologies that are pointing the way - and that way is hydrogen fuel cells, not ethanol. In 15 years, China will be the Saudia Arabia of hydrogen. (I had begun a post on this and put it aside, but since you wrote this piece, I'm putting it up now.)

Your point on sugar: I agree with the recurring Simpsons' take on this. Sugar is our national addictive drug, far more insidious than tobacco because its effects are harder to spot, harder to demonize. ('Cancer' and 'fat' just aren't seen the same way, even if you toss in ties to diabetes and other diseases.) Because sugar is seen as relatively benign, its lobby is extremely effective in gaining legislative support. What should be happening is a hefty national sugar tax, across the board, with the proceeds going to groups such as the National Diabetes Foundation which deal with its effects.

As far as CAFTA itself, it hasn't been on my radar. I'm for anything that eliminates barriers to trade, but I do not know enough about the current state of this legislation to offer a useful opinion. (Sorry.)

 
At 10:30 PM, Blogger Jack said...

Interesting analysis. I've heard that a can of Coca Cola has 10 teaspoons of sugar. Some say that that's enough to shut down an immune system for an hour. But I disagree. However, sugar does not help the national obesity epidemic.

Better to be honest about legislation one hasn't read up on yet than to offer whatever empty rhetoric is floating around.

-Jack

 
At 8:33 PM, Blogger ljmcinnis said...

It is disappointing, but such is politics, a process of considerable give and take. I have NOT read the exact bill yet but I did visit Infidel World.
I believe the best take on it is from Russell Roberts over at www.invisibleheart.com and http://cafehayek.typepad.com/
There is some question about how much political currency was spent for such a small result but for someone like me who will go to my grave defending personal freedom and economic choice, I believe it is and will be worth it...
Speaking of pork...how about that multi million dollar bicycle access project you (N.J.)are up for? I don't know what and how much is planned for CO but I'm sure I won't like it very much. I'm referring to the proposed transportation bill.

 

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