National Security Challenges

NATIONAL SECURITY CHALLENGES -- (House of Representatives - July 22, 2005)

The SPEAKER pro tempore. Under the Speaker's announced policy of January 4, 2005, the gentleman from California (Mr. Dreier) is recognized for 60 minutes as the designee of the majority leader.

Mr. DREIER. Mr. Speaker, today we face a great national security challenge, many challenges in fact.

As we wage a global war on terror, we face an enemy that kills indiscriminately in its campaign against freedom, democracy and political pluralism. The brutal attacks in London just a couple of weeks ago and, of course, the other tragic news that we have gotten from London this week are a tragic reminder of the nature of the enemy that we face. But I believe that the true sign of our times is not the carnage of suicide bombers. It is the image of millions of Iraqis waiting in line to cast their first free votes, and millions more in Afghanistan, the Ukraine, Lebanon, Georgia, Kyrgyzstan, and on and on and on around the world.

Democracy is sprouting in places that seemed unthinkable and that has been the case for quite a while. The worldwide terror campaign that is being perpetrated and the rise of democracy in formerly inhospitable places are not unrelated. Just the opposite, in fact. The war that is being waged against political and economic freedom and our unwavering resolve to defeat it is pushing oppressed people to a tipping point. They are demanding the right to determine their own futures. And as President Bush has so clearly articulated, the spread of freedom is not just a consequence of the global war on terror. It is our best defense. That is, the spread of freedom is the most important thing that we can do for our national security. Those who embrace the democratic principles of liberty, opportunity and tolerance do not resort to terrorism. Aiding the establishment of democratic and free societies is squarely within our national interest.

To that end I have had the great privilege of working with our distinguished Speaker, the gentleman from Illinois (Mr. Hastert), in the establishment of the House Democracy Assistance Commission. I have joined my colleague, the gentleman from North Carolina (Mr. Price) who is the ranking member of this task force.

The House Democracy Assistance Commission provides a forum for this body to play a significant and proactive role in establishing the strong, independent, transparent legislatures that are essential to a vibrant and healthy democracy. Our commission was established precisely because we realized that spreading freedom throughout the globe is as critical to preserving it right here at home because we realize that we cannot abandon anyone to tyranny.

Just a short time ago most of us could not have imagined millions of Iraqis turning out to vote. But there they were on January 30, defying the terrorists and the world's expectations of what would happen there.

Those of us who have been engaged with Central America over the past 2 1/2 decades have been amazed by the transformation that has taken place there as well. Like their Iraqi counterparts, the people of Central America have made the journey from violence and oppression to democracy and freedom. Many of my colleagues will remember just how difficult that process was.

Two decades ago President Reagan and this body were deeply concerned about the threat posed to the United States by the communist expansion and civil war that existed in our own backyards. As the Cold War neared its fourth decade, violent conflict in El Salvador, Guatemala, Nicaragua and Honduras had the region in turmoil. Stability, let alone democracy, seemed absolutely unattainable.

Today the region is just as important, Mr. Speaker, to our national interests. But rather than a threat, Central America is an ally and a partner in trade, counter terrorism, drug interdiction, and migration control. Our Central American friends play a vital role in the security and well-being of the United States of America.

Again, for those who remember the struggle of the 1980s, this transformation is no less astounding than the one taking place at this very moment in Iraq. And our commitment to solidifying and strengthening the democratic institutions that are taking root there should be no less firm today than it was a decade and a half ago when this process began.

The people of Central America have embraced democracy, but they now expect concrete results from their democratically elected leaders, and rightly so. They must find new opportunities for prosperity and a higher standard of living or they will question the democratic institutions that have only recently brought peace to that region.

We cannot take the threat of faltering democracy lightly.

Recent events in Venezuela and Bolivia are a testament to the potential for political instability in the absence of economic growth. Great economic gains have been made in the decade and a half since democracy took hold, but there is far more that needs to be done, Mr. Speaker.

The average gross domestic product per capita for the five countries of DR-CAFTA, and those countries are the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, Costa Rica, the GDP on a per capita basis is roughly about $2,660 or less than 7 percent of the U.S. GDP per capita. Even citizens in the post successful of those 5 countries, Costa Rica, have one-fourth the purchasing power of the average American. Inflation, unemployment and under-employment are significant challenges.

If these economic realities are not more effectively resolved, our neighbors could in fact turn to alternative leadership. Leadership far more hostile to the United States and democracy. All one needs to do is simply witness Venezuela and their President, Hugo Chavez.

The countries of -CAFTA have 2 paths before them. One leads to trade liberalization and the rule of law. The other leads to protectionism and the rule of the well-connected. The United States should not slam the door in the face of those who are making the right and difficult decision to pursue open trade.

The presidents of the DR-CAFTA countries have staked much political capital on their decisions to adopt this multilateral free trade agreement. The DR-CAFTA leaders have embarked on this path because they know it will mean for their citizens, they know it will mean a great deal for them, economic opportunities, less economic stratification, increased economic transparency, a strengthened rule of law and hope for the future.

An American rejection of the Dominican Republic-Central American Free Trade Agreement, would be politically devastating to these democratically elected governments that have staked so much on the promise of this agreement. If they are unable to deliver on the economic improvements they have pledged, these visionary leaders will be pressured to pursue protectionism over liberalization, or worse, failure to enact the Dominican Republic-Central American Free Trade Agreement, could lead to the rise of the political elite, a political elite that is hostile to the United States, inclined to demagoguery, and uncooperative in regional security and economic affairs. Again, all one needs to witness is Venezuela's Hugo Chavez.

Now, let us consider the case of Nicaragua.

President Enrique Bolanos' government in Managua faces a litany of threats on a daily basis. An unholy alliance of the extreme left led by Daniel Ortega and of the extreme right led by jailed former President Aleman is challenging the authority and stability of the Bolanos government. These two old Nicaraguan political hands, Ortega and Aleman, would seem to have little in common but they do share a distaste for the free market. These men have staked their political futures in large part on their opposition to the Dominican Republic-Central American Free Trade Agreement.

Defeating the agreement would give credence to their anti-economic liberalization rhetoric and momentum to their undemocratic plots.

Aleman cares more for his own enrichment than for democracy and Ortega is a compadre of Fidel Castro's and routinely describes the United States of America as an ``enemy of humanity.''

Ortega also keeps close company with Commandante Tomas Borge, someone who I got to know quite well during the 1980s. Tomas Borge is the only surviving member of the Sandinista Front in Nicaragua. He has said that the defeat of the Dominican Republic-Central American Free Trade Agreement which he has worked very hard to bring down, the defeat of that would lead to the consolidation, he says, of the ``leftist triangle.'' That leftist triangle of course is Cuba, Venezuela, and as he says, now Nicaragua.

Coming from a man who founded an organization, the Sandinista Liberation Front, that violated human rights, consorted and to this day continues to consort with terrorists, and targeted Americans is obviously a very troubling sign. A return of the Sandinista regime and the establishment of an anti-American coalition involving Castro and Chavez would be extremely dangerous for the United States and for our regional interests.

We must do everything in our power, Mr. Speaker, to support the positive democratic governments we worked so hard to help create. A return to the violent past would be devastating for the United States, the region and, most tragically, the people of Central America for whom we fought and struggled so hard during the 1980s.

Just as we are working to spread freedom and democracy around the world, we must not negligent it in our own back yard. We must help to increase the prosperity that undergirds peace. And we can accomplish this, Mr. Speaker, by passing the Dominican Republic-Central American Free Trade Agreement. But DR-CAFTA and the economic future of the region are not just critical to our security interests. They are vital to our economic interests as well.

Over the past 20 years, we have unilaterally opened our market to Central American trade. Producers in the DR-CAFTA region send 80 percent of their goods, including 99 percent of their agricultural products, to the United States of America duty free.

Now, that is good for U.S. consumers to have access to all of those things. These special preferences have enjoyed strong support from the Congress. Large bipartisan, and I stress bipartisan, majorities in both Houses of Congress have long recognized the importance of supporting economic growth in the region. Back in 1983, we passed the original Caribbean Basin Initiative in the House by a vote of 392 to 18. It does not get much stronger and more bipartisan than that.

Since then, we have continued to acknowledge that opening our economy to the Central American people is critical to stabilizing the region and providing the tools that will lift them out of poverty. In 2000, the House reaffirmed our commitment to creating new opportunities in this hemisphere when 309 Members, which included 183 Republicans and 126 Democrats, voted in support of the Trade and Development Act, further opening the U.S. market to Central American goods.

With DR-CAFTA, our partners in the region are offering to make these benefits reciprocal. They have access to our markets. Everything that they have can come virtually duty-free into the United States. Now, U.S. producers under this agreement will enjoy the duty-free access that their Central American counterparts currently enjoy. Tariffs on 80 percent of all manufactured goods will immediately drop to zero, Mr. Speaker, that is from 80 percent to zero, while the rest are phased in over a 10-year period of time.

But lower tariffs are just the beginning. In the 21st century it is not just the product itself that is important; it is the idea behind the product, the innovations and the creative content, that make U.S. producers so valuable and our economy so strong. Our knowledge-based economy, based on our power to innovate, has secured our place as the world's economic superpower.

But as intellectual property grows in significance to the United States economy, so does the importance of protecting intellectual property. We always talk about the importance of property rights. Intellectual property is equally important.

DR-CAFTA fully accounts for the value of intellectual property and provides the state-of-the-art protection that our 21st-century economy demands. It will bring the region's intellectual property laws in line with U.S. laws. It will ensure that violators will be appropriately punished. And, most important, it will provide the tools to successfully enforce these comprehensive commitments. This agreement will create an environment where innovative American goods can compete fairly and openly. Without these protections, Mr. Speaker, the benefits of low tariffs could not be fully realized.

The 21st-century economy is also a service-providing economy. Services, those that cater to consumers like you and me, those that cater to other businesses now make up 80 percent of private-sector GDP, as well as 80 percent of employment in this country. And it is in these sectors that our DR-CAFTA negotiators achieved some of our hardest fought and most significant gains.

Service sectors in the DR-CAFTA countries are heavily protected, and in many cases they are closed entirely, closed entirely, to foreign investment and to competition as well. This agreement will open up these markets virtually across the board for the highly competitive service providers based here in the United States. From telecommunications to insurance to financial planning, DR-CAFTA will grant the United States new access in the sectors that make up the backbone of our economy and the future of our continued competitiveness.

But to fully grasp the significance of this agreement for our economy, we have to look beyond individual sectors and tariff schedules. We have to look at the bigger picture. Mr. Speaker, we live in a global economy. We were reminded of that just this week when Prime Minister Singh delivered his address, the Indian Prime Minister, to a joint session of Congress. The impact of the worldwide market is growing, not shrinking. It would not be in our interest to run from globalization, even if it were possible for us to do so. Our response must be to become more competitive and continue to prosper from a growing global marketplace. After all, 94 percent of the world's consumers are outside of our borders.

A key part of making this region more competitive is to work together. We already have economies that are complementary, and there is no better example of how the economic relationship between the United States and the Dominican Republic-Central American countries region can work for our mutual benefit than the textile and apparel industries.

The DR-CAFTA countries are the second largest importers of U.S. textiles. Again, they are the second largest importers of U.S. textiles; and we are their largest export destination for finished product, for apparel. At a time when the United States textile industry looks for new ways to remain competitive in the global economy, this region is our strongest trading partner in textiles and apparel.

Just look at the content of clothes that our families wear. Central American apparel is made mostly from U.S. products, 80 percent on average. Apparel coming from the Pacific Rim, by contrast, is made up of less than 2 percent, 2 percent, U.S. content. Again, 80 percent of that from Central America is U.S. content. Only 2 percent from Asia is made up of U.S. content.

With the lifting of worldwide textile quotas earlier this year, we all face the challenge of growing Chinese imports. This includes Central American apparel manufacturers, who have been forced to close up shop as a result of increased Sino competition. The Dominican Republic-Central American Free Trade Agreement provides the opportunity to strengthen the regional supply chain and boost an apparel industry that is heavily dependent on U.S. products.

Upon enactment of this agreement, Mr. Speaker, more than 90 percent of all apparel made in the DR-CAFTA region will be sewn from fabric and yarn made right here in the United States of America. All American textile goods will receive immediate duty-free access to the DR-CAFTA market, and these benefits will be retroactive to January 1 of 2004. That is a year and a half back.

By dismantling the trade barriers that have hindered job creation here at home, we will create new opportunities for America's workers. And by strengthening regionally based industries, job creation here in the United States will support job creation in the DR-CAFTA countries. Far from a zero sum game, a zero sum scenario, we have the chance to prosper and grow together.

The opportunities for greater economic opportunity do not end with textiles and apparel. As the DR-CAFTA economies grow and diversify, the strengths of our economies will continue to reinforce each other. This further integration of the regional economy will build upon the tremendous success of another FTA, an FTA that we are frequently told rhymes with CAFTA.

Many DR-CAFTA opponents paint the agreement as a repeat of the North American Free Trade Agreement, NAFTA. Then they bemoan NAFTA as a catalyst for economic failure and job loss in the United States. Mr. Speaker, one simply has to look at the economic facts to declare their rhetoric as the distortionist tactics of protectionists.

So what are these facts? First, since NAFTA's implementation, we have added 20 million jobs to our labor market here in the United States. Our economy has grown by 38 percent since implementation of the NAFTA. U.S. exports to our NAFTA partners have more than doubled, growing by 112 percent. Let me say that again. Many people believe that we only buy everything from Mexico and Canada. But our exports since passage of the North American Free Trade Agreement have increased by 112 percent.

Some of the biggest economic gains have been, believe it or not, Mr. Speaker, in the manufacturing sector. Manufacturing output has risen by a third, while real manufacturing wages have increased by 27 percent. And NAFTA has yielded 43 percent of U.S. manufacturing export growth as well as 28 percent of import growth. So we have seen that this has clearly been a win-win all the way around.

The U.S. certainly has not monopolized the benefits of NAFTA. The agreement also led to 30 percent growth in the Mexican economy. While economic liberalization has moved more slowly and less uniformly than we would hope, it is clear that increased trade has been a very positive force there as well. Wages in Mexico in trade-related industries are 37 percent higher than in other industries. Again, in trade-related areas we have a 37 percent higher wage rate in Mexico than in other areas. Mexican wages and employment are higher in states with higher foreign investment and trade; and migration from those states, Mr. Speaker, is lower. Wages are also higher in sectors with more exposure to either imports or exports.

First through NAFTA and now through DR-CAFTA, we are cooperating, growing, and becoming more competitive with our friends and neighbors in this region. We can continue to use our respective strengths and resources to our mutual benefit and compete in the worldwide market.

Many of my colleagues, Mr. Speaker, claim that mutually beneficial cooperation is not possible because the DR-CAFTA countries are too poor and their labor protections are far from perfect. It is certainly true that far too many Dominicans and Central Americans live in poverty. No one is ignoring that fact. But how can we look at rampant poverty in our own back yard and then condemn our neighbors to remain in these conditions?

The World Bank recently conducted a study of DR-CAFTA and the impact it would have on the region. Their findings were very clear. This agreement will reduce poverty and raise the standards of living for Dominicans and Central Americans, they found. As the report notes, parties to free trade agreements experience higher growth in GDP, averaging a 3 percent increase over 5 years. For the DR-CAFTA countries, this extra 3 percent growth will mean that nearly half a million people, nearly half a million people will be lifted out of poverty by the end of this decade.

The World Bank confirms the DR-CAFTA will increase investment in the region, combat corruption, and improve the quality of public institutions. It will raise the standard of living, particularly for those who are living in poverty. It will spur innovation, and it will solidify the broad economic gains made in the region in recent years.

The report's analysis further notes that FTAs like DR-CAFTA lead to higher wages and improved working conditions. All of these factors lead the World Bank to conclude: ``A central factor in determining the future of Central America will be the ratification and implementation of a Dominican Republic-Central American Free Trade Agreement.''

Mr. Speaker, rejecting CAFTA, on the other hand, would simply sanction the status quo. Let us look at all the challenges we have. No one has offered an alternative to the DR-CAFTA. If we were to reject it, it would deny the DR-CAFTA countries the tools to create jobs and develop the resources to implement strong labor protections. Congress recognized this principle when we passed free trade agreements with Jordan and Morocco. Both Jordan and Morocco have struggled with high poverty levels and a lack of adequate resources to fully enforce labor protections.

Yet bipartisan majorities in the House and Senate demonstrated that economic liberalization was key to improving these conditions and sent these FTAs to the President's desk.

That was a decision that both Houses of Congress made with bipartisan votes. Once again, we have the opportunity to combat poverty and improve labor conditions with the passage of the Dominican Republic-Central American Free Trade Agreement.

Once again, Mr. Speaker, these positive economic benefits have broader security implications for the United States. Rising standards of living in the region will assist in resolving an issue that affects all of us, that issue is illegal immigration. Specifically, we can deter illegal immigration by addressing one of its root causes, that being poverty.

Mr. Speaker, illegal immigration is a national problem that saps the resources of local law enforcement, overwhelms our medical system, and puts great strains on our schools. With over 10 million illegal immigrants in the United States, the cost to the Federal Government and State governments, as we all know, is enormous.

Nearly all illegal immigrants to the United States come in search of work, economic opportunity, a chance to feed their families because they have found limited opportunity at home. In fact, T.J. Bonner, the President of the National Border Patrol Council, estimates that 98 percent of illegal immigrants come to this country for one reason and one reason only, seeking economic opportunity. To stem the tide of illegal immigrants, it stands to reason that we should encourage economic prosperity in the countries that are frequently the source of those illegal immigrants.

DR-CAFTA gives the Dominican Republic and the Central American countries the much-needed push towards prosperity that they so strongly desire. It will open markets and opportunity in the region, allow their citizens to purchase more goods for less money, give small businesses reason to expand, help create jobs, and raise the standards of living.

And most important, the people of Central America will have an incentive to build their future in their own countries rather than to make the dangerous, illegal attempts to enter our country. This is in our best interest as a country. It is our duty as a steadfast ally to our friends and neighbors in Central America.

As the former President of Costa Rica, the Nobel Peace Prize winner Oscar Arias wrote in the Washington Post, ``The Central American Free Trade Agreement would allow Central America to thrive by exporting goods through trade rather than exporting people through migration. Access to the U.S. market is the most important tool to speed our economic and social development and to keep our people at home.''

Mr. Speaker, I urge this body not to, in the words of Oscar Arias, punish Central America for achieving peace.

Tom Friedman of the New York Times recently wrote, ``In the 1980s we were worried that Central America was going communist. Now it seems today that people are worried that Central America is going capitalist.''

Our neighbors want to embrace that economic liberalization and what it can bring. Through the Dominican Republic-Central American Free Trade Agreement, we will help them continue to make progress against poverty in our hemisphere and reduce the flow of illegal immigrants into the United States.

Unfortunately, it is on this very issue of immigration that the DR-CAFTA debate has become clouded. There has been some confusion as to the impact of the agreement, and the impact it will have on U.S. immigration law. I would like to set the record straight. There is absolutely nothing in the agreement that affects our immigration laws. To ensure against any ambiguity in that matter, all seven parties to the agreement signed a legally binding document unequivocally saying ``No provision of the agreement shall be construed to impose any obligation on a party regarding its immigration measures.'' That is actually part of the agreement.

To make it very clear, nothing in the Central American Free Trade Agreement will in any way modify U.S. immigration law. DR-CAFTA fully preserves both existing U.S. immigration law and the power of this Congress to legislate at its discretion on immigration matters. In fact, DR-CAFTA fully preserves the power of this Congress to legislate at its discretion on any matter whatsoever.

This agreement will not cede our sovereignty or create loopholes in our immigration law, as some have argued. What it will do is lower the tariff and nontariff barriers our producers and service providers currently face. It will strengthen the regional supply chain that helps us compete globally, particularly with regards to China. It will build upon the economic gains we have already achieved in this region through the North American Free Trade Agreement, and it will pave the way for even stronger gains throughout the hemisphere.

DR-CAFTA will provide the Dominican Republic and the Central American people with the tools to reach the first rung of the economic ladder, and it will help them as they seek to climb that economic ladder. It will provide hope for opportunities at home; and, therefore, an incentive to stay and build a future in their home country. It will reinforce their faith in the power of economic freedom and strengthen their commitment to the rule of law and the free market. And it will solidify these six countries as free and democratic allies right at our doorstep.

Mr. Speaker, we have learned just how critical the spread of democracy is to our national security. Our troops are currently in harm's way in Iraq and Afghanistan, fighting to ensure their fledgling democracies are sustained.

The Central American people have already done the most difficult work. With our help, they have rejected dictatorship, totalitarian, authoritarianism, and they have chosen to embrace democracy. They have laid the foundations of the rule of law, political pluralism and a commitment to free markets.

But these tremendous gains are still very fragile and they are reversible. After all, these are democracies that are only 15 years old. We cannot leave before the job is done. We need the Dominican Republic-Central American Free Trade Agreement to fully achieve what Ronald Reagan set out to do more than 20 years ago, and that is bring permanent peace and prosperity to our back door.

When Ronald Reagan announced his candidacy for President on November 6, 1979, he envisioned a free trade accord for this entire hemisphere. The Dominican Republic-Central American Free Trade Agreement is a very important step on that road towards implementing the vision of Ronald Reagan.

I urge my colleagues to join with us in a bipartisan way, which is the way that we have traditionally dealt with the very important issue of international trade, and come together when we next week cast this critical vote on the Dominican Republic-Central American Free Trade Agreement.

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