The Administration went another step toward implementing a year-old US-Central American Free Trade Agreement yesterday with the House Ways and Means Committee approving by a 25 to 16 vote draft CAFTA legislation (WTD, 6/15/05).

The Administration must now decide when to submit the formal implementing legislation -- an action that starts the legislative clock running under Trade Promotion Authority's "fast track" process for trade agreements. Depending on how quickly the Administration sends the legislation, the House could vote later this month before the July 4 Independence Day recess, according to a Republican aide.

WTD's informal poll of House members' office currently suggests CAFTA supporters are far short of the votes needed to pass the agreement in the House. But support could grow significantly if two issues are addressed -- US sugar producers' concerns about increased imports and members' desire for action against China's unfair trade practices.

Support for CAFTA in the committee at yesterday's informal "mock" markup came mostly from Republicans, but two Democrats -- Reps. William Jefferson (La) and John Tanner (Tenn) -- crossed party lines to vote for the agreement.

Mr. English

Rep. Phil English (R-Pa) was the only Republican to vote against CAFTA. In a statement, he said his "no" vote was intended to send a strong signal that trade problems with China need to be addressed. "In my view, until we deal with the elephant in the room, China, trade liberalizing measures will be advanced with only limited, tepid support," he said. At a minimum, he said US trade laws should be changed to allow countervailing duty cases against non-market economies like China. Mr. English has introduced legislation (HR 1216) to do just that.

At a separate forum, House Small Business Committee Chairman Don Manzullo (R-Ill) also said the House needs to "take care of the China problem" before voting on CAFTA.

Florida Republican Mark Foley voted for the agreement, but said his continued support is contingent on getting an agreement between the Administration and US sugar producers who are opposing CAFTA. He urged the sugar industry to take a more conciliatory attitude and work with lawmakers and the Administration on solutions, instead of simply blocking CAFTA. Another Republican, who has been undecided on CAFTA over sugar -- Rep. Dave Camp (Mich), also voted in its favor.

Voting for CAFTA were:

Republicans Bill Thomas (Calif) -- chairman E. Clay Shaw Jr. (Fla) Nancy L. Johnson (Conn) Wally Herger (Calif) Jim McCrery (La) Dave Camp (Mich) Jim Ramstad (Minn) Jim Nussle (Iowa) Sam Johnson (Texas) J.D. Hayworth (Az) Jerry Weller (Il) Kenny Hulshof (Mo) Ron Lewis (Ky) Mark Foley (Fla) Kevin Brady (Texas) Thomas Reynolds (NY) Paul Ryan (Wis) Eric Cantor (Va) John Linder (Ga) Bob Beauprez (Colo) Melissa Hart (Pa) Chris Chocula (Ind) Devin Nunes (Calif)

Democrats William Jefferson (La) John Tanner (Tenn)

Voting "no" were --

Republicans Phil English (Penn)

Democrats Charles Rangel (NY) -- ranking Fortney Pete Stark (Calif) Sander Levin (Mich) Benjamin Cardin (Md) Jim McDermott (Wash) John Lewis (GA) Richard Neal (Mass) Michael McNulty (NY) Xavier Becerra (Calif) Lloyd Doggett (Texas) Earl Pomeroy (ND) Stephanie Tubbs Jones (Ohio) Mike Thompson (Calif) John Larson (Conn) Rahm Emanuel (Ill)

Labor

US Trade Representative Rob Portman recently committed to working with Democrats on their concerns that labor provisions in CAFTA are too weak. He has offered to increase assistance to the CAFTA countries to improve enforcement of their labor laws and to monitor labor law compliance.

The committee approved a substitute amendment by Chairman Bill Thomas (R-Calif) that creates periodic reporting requirements on CAFTA's labor provisions and proposals for labor law improvements made by the CAFTA countries earlier in the year.

The committee substitute also adds a provision requiring the President to report to Congress on whether CAFTA has had a negative impact on the services industry. It also calls on the Administration to make recommendations on how the Trade Adjustment Assistance program should be amended.

The Senate Finance Committee Tuesday at its "mock" markup approved an amendment extending TAA benefits to services workers.

Although the two committees reported out slightly different draft bills, they are not expected to hold a "mock" conference, since the panels' recommendations are not binding on the Administration.

Ways and Means rejected a number of amendments offered by Democrats, including one that would have required the CAFTA countries to meet core international labor standards within three years. Committee Democrats argued strongly that CAFTA's "enforce-your-own-law" labor standard would be a step back from the more stringent requirements the countries currently face under the Caribbean Basin Initiative and Generalized System of Preferences trade preferences programs. The amendment was defeated on a party-line vote of 16 to 24.

Also rejected were amendments that would have dropped the requirement that CAFTA countries protect drug manufacturers' test data for five years and double funding for the TAA program.