• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Outlook for CAFTA Unclear in the House

Posted on: Wednesday, 20 July 2005, 18:01 CDT

Jul. 20--WASHINGTON -- Several fence-sitting Pennsylvania Republicans are among a handful of lawmakers who could decide the fate of a trade agreement that might yield huge benefits for some businesses, including The Hershey Co.

About 70 union representatives in orange T-shirts canvassed Capitol Hill Tuesday in hopes of swaying undecided House members, including U.S. Rep. Todd Platts, R-York County, to oppose the deal they believe will threaten American jobs.

The House could vote on the Central American Free Trade Agreement as early as next week. The Senate approved CAFTA 54-45. But the fate of the trade agreement, which the Bush administration has been pushing, remains uncertain.

The pact, which would remove most tariffs on products from Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua, has drawn in powerful lobbying groups, including the U.S. Chamber of Commerce, labor unions, manufacturers, food producers and farm interests.

The bill is being fought by labor groups, worried about the loss of jobs to overseas competition, and sugar producers, who do not want to see the elimination of price supports that keep sugar prices in the United States higher.

But sugar users such as Hershey, one of the nation's largest candymakers, have lobbied heavily for the bill and getting rid of those sugar quotas.

A Hershey spokeswoman declined to comment and referred inquiries to trade groups that represent the candy company.

One industry analysis estimated that companies like Hershey could cut their costs by nearly 30 percent by relocating operations to Canada, or at least 55 percent by moving operations to Mexico.

"We're talking about giving American businesses and farmers fair access to countries that have had duty-free access to the American market for about 20 years," said Stephanie Childs of the Grocery Manufacturers Association.

If all tariffs are removed, exports of chocolate and other confectionery products are projected to increase by $14 million to $32.4 million annually, or up to 132 percent more than current export levels, according to a study produced for the association, which supports the trade deal.

The CAFTA countries account for less than 1 percent of U.S. trade, but supporters argue the agreement would provide new markets for American goods and create stable political neighbors.

Pennsylvania's exports to the six countries have increased 21 percent since 2000, to $352 million in 2004.

CAFTA opponents believe it will lead to the loss of more American jobs. They cite past trade pacts, including the North American Free Trade Agreement.

NAFTA is blamed for the loss of millions of American jobs, including nearly 190,000 in Pennsylvania, as U.S. companies shifted operations to countries with lower wages and fewer environmental regulations.

"I would certainly hate to see more jobs leave Pennsylvania and the country," said Colonial Park resident Rich Butler, who works for Turbine Airfoil Designs of Harrisburg.

Butler and others opposed to CAFTA met with U.S. Rep. Tim Holden, D-Schuylkill County. Holden opposes the legislation, even though it would benefit Hershey, one of the largest employers in his district.

"NAFTA and granting most-favored-nation status to China has been devastating to the economy of Pennsylvania," Holden contends. "Good family-sustaining jobs that created the middle class are being wiped out."

Holden recognizes Hershey's interest in "looking for the cheapest sugar they can find," but he said the "cons outweigh the pros."

Holden compared the purchasing power of the CAFTA countries to that of Cleveland, and said the pact would have limited benefits for Pennsylvania's agriculture sector.

Platts did not return phone calls Tuesday. He has yet to say how he will vote, but labor representatives who met with his staff and lobbyists were skeptical he would oppose the agreement.

"I think we have a challenge in front of us to make Mr. Platts see our side," said Mike Chilcoat, a retired member of the Teamsters union from Manchester Twp.

In meetings with undeclared lawmakers and aides -- including U.S. Reps. Bill Shuster, R-Blair County; Charlie Dent, R-Allentown; and Michael Fitzpatrick, R-Bucks County -- opponents of the trade pact said they hope to send the message that Pennsylvania has been devastated by similar agreements.

"It's time for our congressmen to wake up to that fact," said Carl B. Dillinger of the Pennsylvania AFL-CIO.

Dent remains uncommitted, but is leaning toward supporting the agreement because it would help stabilize the partner countries, which would improve security in the Western Hemisphere and help the United States maintain a competitive advantage against countries such as China, said his spokesman, Gregg Bortz.

Shuster's office did not return phone calls, but lobbyists said they think he will support the agreement.

Bortz also said the benefits to the state's snack-food and candy industries would be significant. "This helps an industry with a lot of employees in Pennsylvania and maybe help them grow," he said.

But opponents called such a strategy shortsighted.

"If we don't have the money to buy the basic meat and potatoes, we're not going to buy Hershey bars," said Robin Butler, a stay-at-home mother who accompanied her husband to lobby lawmakers against the proposal.

-----

To see more of The Patriot-News, or to subscribe to the newspaper, go to http://www.patriot-news.com.

Copyright (c) 2005, The Patriot-News, Harrisburg, Pa.

Distributed by Knight Ridder/Tribune Business News.

For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

HSY,

Source: The Patriot-News

More News in this Category