April 09, 2008

Bush Faces Uphill Battle on Colombia Trade Pact

By Jim Lobe

As U.S. President George W. Bush Tuesday formally submitted his free trade agreement (FTA) with Colombia to Congress, most analysts agreed that the White House faces a tough, uphill fight to get it approved, particularly in the House of Representatives.

With the two Democratic presidential candidates, Sens. Hillary Clinton and Barack Obama, already committed to opposing the deal, Bush's hopes lie with peeling off just enough lawmakers in the majority party -- while keeping his fellow Republicans in line -- to put it over the top.

In announcing his decision to submit the pact, on which Congress will have to vote up or down within 90 legislative days under "fast-track authority", Bush held out one key sweetener -- his willingness to sign a "good, bipartisan" extension of the now-lapsed Trade Adjustment Assistance (TAA) programme, which could provide billions of dollars in training and benefits for U.S. workers who have lost their jobs due to overseas competition.

"I look forward to completing an agreement on trade adjustment that draws on many of the good ideas contained in bills introduced in the House and the Senate," he said.

Democratic leaders, however, quickly denounced Bush's move, noting that it marked the first time that a president had failed to negotiate a process and timetable with key Congressional leaders in advance of submitting a fast-track trade agreement.

"The president is making a big mistake," said the normally trade-friendly chairman of the Senate Finance Committee, Max Baucus, although some key Democratic leaders suggested that they had not shut the door on a deal that could secure their support.

"House Democrats are committed to supporting Colombia and the efforts of President (Alvaro) Uribe," House Speaker Diane Pelosi and Ways and Means Committee Chairman Charles Rangel said in a statement that stressed Bush's bypassing of normal procedures. They said they could not support free-trade accord "under present circumstances".

Trade union leaders, a key Democratic constituency, were more categorical, however. "There's nothing that could be in TAA that in our view would be considered an adequate trade-off for the Colombia agreement," said Thea Lee, the policy director of the country's largest union federation, the AFL-CIO. "We're not looking for a deal. Period."

While Colombia already benefits from duty-free treatment on most of its exports to the U.S. under the 2002 Andean Trade Promotion and Drug Eradication Act, approval of the FTA would make those advantages permanent. In addition, the pact would eliminate tariffs on more than 80 percent of U.S.-manufactured exports to Colombia.

U.S. exports to Colombia last year were worth slightly more than eight billion dollars, while Colombian exports to the U.S. -- mainly coffee, fruit, and textiles -- came to about nine billion dollars.

While bilateral trade represents a tiny fraction of U.S. trade with Mexico, for example, the fate of the Colombia FTA is seen by both its friends and foes as having much greater regional and even global implications.

The Bush administration and its supporters have argued that the accord should be approved above all for reasons of national security. This point was strongly reinforced Monday when Secretary of State Condoleezza Rice and Secretary of Defence Robert Gates published separate opinion articles in the Wall Street Journal and Miami Herald, respectively, arguing that Uribe's government stands as a pro-U.S. bulwark against the threats posed by both "narco-terrorism" and "authoritarianism" in the region.

"The (FTA) offers a pivotal opportunity to help a valued strategic partner consolidate security gains, strengthen its economy and reduce the regional threat of narco-terrorism," wrote Gates. "This is an opportunity we cannot -- and must not -- ignore."

Administration officials also argue that Congress' rejection of the FTA -- which would be the first ever of a fast-track agreement submitted to Congress -- could be understood by much of the rest of the world, where confidence in the U.S. dollar is already shaky, to say the least, as a rejection of free trade and economic globalisation.

"The U.S. and the world economy is jittery, and still headed for a real panic," according to Chris Nelson in the widely read insider newsletter, 'The Nelson Report.' "A first-ever defeat of a Fast-Track protected trade deal would be seen by the global markets as a portent of coming protectionism and perhaps worse...and how would that impact on world financial stability?"

The White House could be calculating that those considerations alone could force the Democratic leadership into a face-saving deal, according to Nelson, a point implied as well by Rice's warning in the Journal: "(L)et no one think that the choices we make will not echo around the globe."

But with both Clinton and Obama, whose battle for the nomination is currently focused on Pennsylvania, a major industrial state that has suffered heavy job losses over the past generation due in part to foreign competition, opposed to the accord, it will be difficult for even a few Democrats to embrace it, even if White House concessions on TAA are more generous than anticipated.

Clinton herself demoted her chief campaign strategist, Mark Penn, last weekend after it was disclosed that Penn, in his capacity as a public-relations executive, had privately advised Colombia's ambassador here on how to gain approval for the deal on Capitol Hill.

In addition to the two Democratic candidates' courtship of blue-collar workers who have come to see free trade and globalisation as a losing proposition, the Democrats' opposition is also motivated by specific concerns over the plight of union activists in Colombia, some 2,500 of whom have been killed -- mostly by paramilitary death squads -- over the past 20 years, including at least 12 so far in 2008.

While Uribe has boasted of his government's efforts to increase protection for union leaders, both the Democratic leadership and union leaders here argue that Washington should not sign a free-trade agreement with any country where labour organisers find themselves at such high levels of risk.

That argument has appeared compelling even to a few Republicans, although the party's presumptive nominee, Sen. John McCain, has come out strongly for the pact.

"I will not support the FTA with Colombia due to ongoing concerns about Bogota's failure to prosecute individuals, including some close to its government and military, who have murdered and otherwise oppressed union leaders in that country," said Republican Sen. Olympia Snowe Monday.

"Mere progress by the Colombian government in reducing still unconscionable levels of violence against trade unionists is simply not enough," she added. She was joined by the influential former chairman of the Senate Foreign Relations Committee, Richard Lugar, who voiced support for the FTA but added that without "tangible proof" of progress in labour practices in Colombia, the pact could be derailed.

Still, Bush's decision to send the FTA to Congress may at least prove politically clever, if only because it highlights their drift away from the "free-trade" agenda pursued by several Democratic administrations including Bill Clinton's. That, in turn, could persuade major corporate donors, who have been pouring money into Democratic campaign coffers this year, to reconsider.

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