Congress Should Reject US-Colombia Free Trade Agreement

Written by Ralph E. Stone. Posted in Opinion, Politics

Published on June 14, 2011 with 4 Comments

Art courtesy WitnessForPeace.org.

By Ralph E. Stone

June 14, 2011

The Obama administration announced last month that it would not seek Congressional approval of the Free Trade Agreement (FTA) with Colombia until Republicans agree to expand assistance to American workers who might lose jobs as a result. The U.S.-Colombia FTA was negotiated under U.S. Trade Promotion Authority, which means that it can be approved or disapproved by Congress, but Congress cannot amend it. FTAs are nothing more than dollar imperialism. That is, a major economic power — the U.S. — taking unfair advantage of a recovering economy.

The negotiated U.S.-Colombia FTA will give market access for U.S. agricultural, consumer, and industrial products, and will immediately remove all tariffs on about 80 percent of U.S. goods entering Colombia. This includes immediate duty-free treatment of beef, cotton, wheat, soybeans, many fruits, and other agricultural products. The remaining 20 percent of tariffs will be phased out over a period of 10 years for both agricultural products and industrial products. In addition, the agreement provides protections for U.S. investors that will be enforced through a binding international arbitration program.

The agreement also gives U.S. businesses access to Colombian financial services markets. Mutual funds and pension funds within Colombia will be allowed to use U.S.-based portfolio managers. Colombia will also phase out market restrictions related to cable television. And, U.S. suppliers are granted the right to bid on contracts from Colombian government offices and agencies.

Further, the agreement provides improved protections and enforcement of a variety of intellectual property rights for investors in Colombia. The protections are consistent with those of the U.S. and cover products such as software, music, written text, trademarks, and patents.

Under the agreement, the parties agree to enforce their own domestic environmental laws and to fulfill their respective obligations under multilateral environmental agreements.

Colombia is the most dangerous country in the world for union organizing. This is one reason, the International Labor Rights Forum has opposed the U.S.-Colombia FTA because of serious human rights abuses in Colombia. More than 3,000 union leaders and activists have been killed in the last three decades. Many of the deaths are linked to paramilitary forces linked to the Colombian government.

Moreover, large multinational agro-businesses have been tied to paramilitary squads in Colombia. In February 2007, Chiquita Brands International admitted that it had paid $1.7 million to a paramilitary group for protection of its banana plantations. And two Coca-Cola bottlers are allegedly linked to the murder of four union leaders in Colombia.

The Colombian government promised to provide more protection to labor advocates, including shop stewards, union organizers and bargaining committee members. It also agreed to eliminate its current backlog of risk assessments of union leaders and members who have requested government protection. AFL-CIO is still strongly opposed to the FTA but has agreed to talk with Colombia’s labor leaders.

Currently, over 90 percent of U.S. imports from Colombia enter the U.S. duty- free with an average tariff of 0.1 percent. In contrast, the average tariff on U.S. products shipped to Colombia is 12 percent, with certain products facing tariffs of up to 35 percent.

Opponents also argue that the U.S.-Colombia FTA will hurt small peasant farmers in Colombia, who will be forced out of business because they cannot compete with cheap imports of food from the U.S., which subsidizes its farmers. This has happened in other developing countries that have entered trade agreements with the U.S. For example, low priced corn (subsidized by the U.S. government) has forced over a million small Mexican farmers out of business since 1994 when the North American Free Trade Agreement took effect.

And how will non-agro Colombia businesses fare when faced with competition from multi-million dollar U.S. corporations?

The U.S.-Colombia FTA favors the U.S. at the expense of Colombians. It is dollar imperialism at its worst.

What we need is for the Obama administration to develop a trade policy that does not rely on bilateral free trade agreements. Instead, the U.S. should seek a multinational approach through the World Trade Organization. A broader international approach will promote trade that is perceived as fairer to all concerned and will improve the international business climate.

Congress should reject the U.S.-Colombia FTA.

Ralph E. Stone

Ralph E. Stone

I was born in Massachusetts; graduated from Middlebury College and Suffolk Law School; served as an officer in the Vietnam war; retired from the Federal Trade Commission (consumer and antitrust law); travel extensively with my wife Judi; and since retirement involved in domestic violence prevention and consumer issues.

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  • Richmondman

    Free trade agreements, as well as open borders for illegal immigrants, have led to the decline of the organized labor movement in the US, and the decline of the middle class in the US. The US should enact tax policies that only provide tax breaks to companies who hire and employ American workers. We should require basic human rights and wage and benefits for workers who manufacture goods for sale in the USA.

  • Jorge Orwell 1984

    NO to the US Empire-Colombian FTA. Anything the US Empire sticks its nose in isn’t good for another country.

    The decline of the middle class in the US Empire is due to millions and millions of jobs having been off-shored to other countries and those jobs aren’t coming back. The decline of this country has nothing to do with undocumented immigrants picking lettuce and apples and cleaning toilets at below minimum wage. That’s hardly anything! They are just the scapegoat and someone to hate on, and most people seem to need someone to hate.

    I would suggest that people try using the language undocumented immigrants or unregistered immigrants/migrant workers rather than the hate language “illegal immigrants” [sic]. Drop the I-Word.

    When a person does anything else that it outside the law they are not called “illegal burglar” or “illegal shoplifter” or “illegal murderer”. They are called suspects or alleged suspects. Why do people use hate language for unregistered immigrants? No human being is “illegal.” But this hate language is repeated daily by the corporate media and the unthinking sheep that follow them and who allow the corporate media to do their thinking for them.

    Drop the I-Word.

    http://colorlines.com/droptheiword/

  • Richmondman

    How about “persons suspected of having committed a felony by illegally entering the country, or illegally staying without proper visa”. Same thing. How about “persons suspected of felonious federal and state income tax evasion”. Off-shoring manufacturing is a big problem, as is the fact that the construction industry, most entry-level jobs and other jobs that may not target college-educated employees have been given to people who don’t require minimum wages or benefits, because they are still better than they had where they came from. These are weapons being used against the organized labor movement in this country, but lowering the cost of alternatives to unions.

  • Alex Parson

    I don’t know where you got your sources Ralph but one of your points are most certainly wrong. If you read Colombia’s General notes on their tariff schedule, and US’s general notes on their tariff schedule on the FTA, you will find that Colombia has longer tariff elimination times than US do which you are right about. US only has one staging category that last for ten years and then the other one is duty free immediately, but Colombia has thirteen staging categories and they range from only one to being duty free , one for three years,one of five years one for seven years, on for eight years, one for nine years, two for 10 years, one for 12 years, two for 18 years, and 1 for 19 years. Sounds like we did give them a good deal, so I think their market is going to able to compete with us because of this easily but even though it may seem like we got the bad end of it, we will be on equal footing 19 years later.
    Now I am not entirely convinced by your argument because of your lack of sources. In my opinion, you want to get your point out, your going to need proof. How don’t I know you just made up your entire argument and those numbers?

    Source:

    http://www.ustr.gov/trade-agreements/free-trade-agreements/colombia-fta/final-text