Congressman Bill Pascrell

Representing the 9th District of NEW JERSEY

Problems Plague 3 Free Trade Pacts Before Congress

Oct 15, 2011

FOR THE past 30 years, our trade policies have operated under the assumption that any trade deal is a good one.

And in that time, we watched millions of manufacturing jobs leave our shores, especially following the passage of the North American Free Trade Agreement and permanent normal trade relations with China. In the past decade, the United States has lost 5 million manufacturing jobs.

That is why when Democrats held the House majority in 2006, we swore that our trade policy would reflect our values as Americans. We would not make unfair deals that force U.S. workers to compete with countries that mistreat workers and pollute the environment.

On May 10, 2007, my colleagues and I on the House Ways and Means Committee achieved a breakthrough. We insisted that pending free trade agreements negotiated by the Bush administration with Peru, Colombia, Panama and South Korea be renegotiated to require these countries to comply with international labor and environmental standards.

I supported the Peru Free Trade Agreement because it included these requirements. It was a good first step toward a truly fair trade policy that benefits the American middle class, not just those at the top.

This past week, the remaining three trade agreements came up for votes in the House of Representatives. The non-partisan U.S. International Trade Commission had reported that the impact on American job growth from the agreements with South Korea, Colombia and Panama would be, respectively, "negligible," "minimal" and "very small."

These projections indicate that Congress must get working on the China Currency Bill and other bipartisan trade policies that will actually foster meaningful job growth. With 14 million Americans out of work, job creation must be Congress’ top priority.

One of the biggest problems with the pending U.S.-South Korea agreement is that it allows South Korean goods shipped to the United States to contain as much as 65 percent foreign content. That means that cars assembled in Korea can contain parts manufactured in China, resulting in China gaining backdoor access to the U.S. economy — completely duty free.

As it is, U.S. customs officials are already trying to crack down on Chinese companies trying to illegally transport their goods through South Korean channels. This agreement only exacerbates that problem and the challenges American workers are facing from competition with cheap Chinese labor.

As for Colombia, 51 trade unionists were assassinated there in 2010. This year, 22 have been killed. Meanwhile, Colombian authorities have obtained just six convictions from 195 union murders that occurred between January 2007 and May 2011, according to Human Rights Watch.

This is precisely why House Democrats took a stand for internationally recognized labor rights in 2007. Although President Obama and Colombia’s President Juan Manuel Santos agreed to an Action Plan Relating to Labor Rights in April, the effort, so far, has been deficient. At a bare minimum, there should be no agreement with Colombia until all provisions of the Labor Action Plan are satisfied. Our trade policy should reflect our values. Without Colombia dramatically improving its labor situation, I voted against the free trade agreement.

Although I continue to have concerns about the Panama deal, the Panamanian government has begun to address the nation’s long-standing role as a haven for those seeking to evade American taxes, issues that have prevented the free trade pact from advancing. They have reached a tax information exchange agreement with the United States to remedy these concerns. They have also made the changes necessary to bring their labor laws in compliance with international standards.

Panama is currently the source of the largest trade surplus we have with any Western Hemisphere country, one that is expected to increase as a result of this proposed agreement. This agreement is not perfect, but it is a step in the right direction to a fairer trade policy.

Moving forward, we must remember that it isn’t enough that our American corporate interests are served as we do business throughout the world. We must also serve our American values, lest we forget all of the progress we made for the American worker and our way of life during the past 100 years.