Garcia Cons Rangel on Peru Trade Deal

This is going to be a little complicated to explain but stay with me. It’s important.

After secret negotiations with the White House last May, the Democratic leadership (Pelosi, Reid, Hoyer and Rangel) agreed to remove provisions in the proposed trade agreement with Peru that would have demanded environmental and worker protections, including an expanded role for Peru’s trade unions. Dissident liberal Democrats were furious and demanded that the provisions be put back into the deal. The leadership hemmed and hawed until July, when Bush sent out his trade Rep, Susan Schwab, to smack the protesters up-side de haid.

The administration struck back at Democrats today in a sign that the comity on trade that followed a deal between U.S. Trade Representative Susan Schwab and Democratic leaders in May might be disintegrating.

The Democrats’ proposals “would be interpreted as an effort to stall the U.S. approval process and add unnecessary and provocative conditions,” Schwab wrote in a letter to House Speaker Nancy Pelosi released today. They “would be a fundamental break with U.S. law, policy and practice.”

Which is, of course, pure Bushian bullshit. But it gave the Democratic leadership cover, and by August House Ways and Means Chair Charlie Rangel was thundering that he intended to pass the trade agreement come hell or high water despite objections from his own party members.

The U.S. Congress will give priority treatment to approval of a free trade pact between the U.S. and Peru when it reconvenes in September, the powerful head of the Ways and Means Committee promised Monday during a visit to Lima.

“It is a priority when we return to the Congress in September,” Rep. Charles Rangel, D-N.Y., told reporters after meeting with President Alan Garcia to discuss the agreement.

He was accompanied by Rep. Sander Levin, D-Mich., and Rep. Allyson Schwartz, D-Pa.

Rangel said he was bringing “the total support” of the leaders of both parties in the U.S. House of Representatives and the U.S. Senate for “for moving this free trade agreement forward.”

Meanwhile, Schwab spent her summer traveling the country with a Free Trade dog-and-pony show, meeting exclusively with business groups and ignoring the anti-FTA protesters who sprouted everywhere she went. Her recent visit to Portland, Oregon, was typical.

U.S. Trade Representative Susan Schwab swept through town on a campaign-style swing promoting free trade. About three dozen demonstrators with labor and environmental groups rallied outside the Arlington Club, where she addressed business leaders.

The face-off foreshadowed debates in Congress, where party leaders are calling for progress on multination trade talks before scheduling votes.

Schwab, who holds a Cabinet-level position in the Bush administration, called on Congress to ratify trade agreements, including those with Peru, Colombia and Panama. She said the pacts would open foreign markets to U.S. exporters, boosting employment.

“These three trade agreements should be no-brainers,” Schwab said during a meeting earlier Thursday with members of The Oregonian’s editorial board.

Rangel has been under intense pressure from the Bush Admin and K Street, according to David Sirota (who provided all these links and has been on top of this story since Day One), but he claims his enthusiastic support for the Peru deal came from a meeting with Pres Garcia in which he said he had been “favorably impressed with Garcia’s commitment to labor rights, including the right of Peruvian workers to belong to unions and to participate in strikes for better wages and benefits.”

When Peruvian trade unionists heard that, they were appalled, and two weeks later they sent a letter (pdf. file) to Rangel and the rest of the House denouncing Garcia’s govt.

We, the Peruvian labor unions are first-hand witnesses of how the Garcia Administration has been blocking the attempt to improve our labor laws through the approval of a General Labor Law that many have been demanding for the past 6 years. We also note with shock that they intend to respond to the changes demanded by the US Congress with only partial measures. Even these will quickly be neutralized by the administration of President Garcia through the creation of a new piece of “small” businesses legislation…that will ultimately impose an even weaker rights standard for the majority of workers in Peru.

The difficulty, they explained, lies in a trick clause Bush’s trade lawyers inserted into the agreement that deliberately uses the wrong reference point.

The main problems arise from the fact that the new labor obligations refer only to the ILO Declaration of 1998, instead of the eight conventions on fundamental labor rights that serve as its foundation. There are already decades of jurisprudence on these conventions, which could make it difficult for the dispute resolution mechanism established in the FTA to follow the ILO norms, and could in fact lead to fundamental rights at work being defined in a vague and fluid way.

Vague and fluid norms will not be applied in the context of expansive commercial obligations included in the FTA. These obligations have not been changed despite the protests of our unions and many sister organizations in the US. For example, our request to limit the liberalization of products that are particularly sensitive for our rural population was ignored. This demonstrates a failure to reflect on the dramatic effects in Mexico of the opening of the corn market under NAFTA, including the displacement of more than a million peasant farmers. The lack of economic alternatives forced many peasant farmers to immigrate to the United States either legally or illegally. Unfortunately, the current FTA could produce a similar outcome in Peru, in turn increasing rates of drug trafficking, violence and even terrorism.


The Peruvian government should approve new labor legislation that conforms to the Conventions of the ILO. This should include the elimination of the systems of unjustified firing, temporary contracts and outsourcing that have been employed intensely in recent years to reduce the presence and power the unions and collective businesses. They should abandon their effort to reform the legislation on small businesses (given that 97% of all businesses in the country could be considered “small”) which would subject the majority of Peruvian workers to a labor regime with even fewer rights than exist now. Finally, they need to dramatically raise the miserable 0.39% of the general budget that is presently earmarked for Ministry of Labor, to a percentage that will permit it to ensure compliance with labor law.

A different model of business is necessary and viable so that the workers of Peru and the United States secure their well being. The people of the United States want that, and we in Peru do as well.

(emphasis in the original)

In other words, in its current form, the labor protections in the Peru FTA are, as Sirota put it, “more mirage than reality”. Garcia served up a load of self-serving crap for Rangel and Charlie swallowed it whole. Or pretended to….

The desperate determination of the Dem leadership to give Bush the horrible, corporate-friendly trade agreements he’s demanding can only be explained by their equally desperate determination to keep corporate campaign $$$ flowing into Dem coffers. But as bad as these agreements all are (the deal with Panama is a disgrace), what’s worse is that Bush is insisting on fast-track authority.

[S]everal states have taken action this year on various trade bills, including resolutions calling for an end to Fast Track trade authority and resolutions that say states should have more input into trade decisions.

Fast Track, which expired June 30, allows the president to push through trade deals with no amendments from Congress, such as those that would ensure the deals don’t destroy good U.S. jobs.

Fast Track has been a major weapon in President Bush’s trade arsenal, helping produce flawed agreements such as the Central American Free Trade Agreement (CAFTA) and the proposed agreements with Colombia and South Korea.

The Democratic leadership’s collusion with the Bush Administration on trade agreements that are little more than excuses for corporate thievery by the multinational conglomerates, and mechanisms to subvert and control union activity, is unconscionable. That they are doing this virtually in secret, ignoring the wishes of a majority of their own party’s representatives is an abomination. Even as Democratic candidates are trolling for union endorsements, their party is stabbing workers in the back, and this time not just in the US.

To say this is unacceptable is an understatement. If Congressional Democrats don’t revolt against their leadership rather than be strong-armed into voting for these horrendous corporate give-aways, they will forfeit all claim to either respect or support.

4 Responses to “Garcia Cons Rangel on Peru Trade Deal”

  1. Now here’s a thought. Outside of Bushian Scandal, the focal point of politics is the presidential elections. Personally, I’m not an Edwards supporter, but given the fact that he seems determined to woo the old Labor bloc, would there be a way to try and get him on it?

    This would be a win-win in my opinion, unless he too is supportive of the measure, then we’re at a loss. But him taking the issue on could result in bolstering his pro-labor bonafides among the electorate he is trying to court, while at the same time giving more visibility to something that leadership on both sides of the fence and the White House would like to see kept swept under the rug.

  2. mick says:

    I don’t know. It’s an interesting idea. Given the way he’s positioning his campaign, I should think it would be a natural fit. Don’t know how much good it would actually do. As Sirota points out in another context, the Democrats are pushing the “we can’t do anything about it” strategy even when it’s an obvious crock.

  3. You don’t even necessarily need a majority or the leaders on this one, you just need to pool a big enough caucus to filibuster.

  4. mick says:

    No, that already exists around the Colombian and South Korean deals, and there isn’t so much as a hint it’s going to happen or even that anyone is considering it because the leadership has clamped down.

    What you need is a pool willing to revolt, and again, there’s no sign of that.

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