Today marks the day that the House Ways and Means Committee has scheduled a hearing on the Central American Free Trade Agreement. And thousands of miles away in North Dakota, Secretary of Agriculture Mike Johanns will be greeted in North Dakota by staunch opposition to the trade deal.
On Wednesday morning, House and Senate members from both sides of the aisle joined forces with business, trade and labor organizations to oppose CAFTA. The National Farmers Union says that CAFTA, and the U.S. trade agenda as a whole, negotiates with countries that want increased access to U.S. markets rather than with countries interested in buying more U.S. agricultural products, such as Cuba.
And the Red River Valley producers in the Dakotas are also getting a clear message out that the trade deal is the "tipping point" of the death of the entire sugar industry. Roger Johnson, North Dakota's Agriculture Commissioner explains that CAFTA by itself isn't the end of the industry, but the economic impact of increased sugar access in CAFTA times five with additional trade deals would take away 150,000 jobs that are directly tied to sugar production.
And if the sugar industry is gone, Johnson warns, those half million acres once planted with sugar beet would change to other commodities. The acreage shift would then lower other commodity prices because of overproduction.
When CAFTA supporters have been trying to persuade legislators to support the deal, they've used economic figures from the American Farm Bureau Federation that show CAFTA would result in nearly $1.5 billion in new U.S. agricultural exports to the region.
Opponents are using figures from the U.S. International Trade Commission that indicate the annual trade deficit with CAFTA countries is projected to grow by another $1 million to $2.4 after the 15-year transition period.
ITC says the FTA is likely to provide little immediate additional market access for U.S. corn and rice exports. In the longer term, annual incremental U.S. exports of corn and rice to the region are likely to increase substantially, albeit from a small base, with a negligible impact on total U.S. production and employment."
Opponents also cite the ITC as saying that since the region grows no wheat, it depends on imports for their domestic consumption. U.S. wheat exports to the CA/DR region face no tariffs, and are not likely to be affected by the agreement.