opinion

Dear Members of Congress,

The three hundred and fifty organizations listed below, including diverse national, state and local groups from the faith, family farm, labor, consumer and environmental sectors, look forward to working with you and the Obama Administration on the promise of change realized in the recent election.

Our more than eighteen million combined members know one of the greatest challenges facing our nation is creating new trade and globalization policies that serve America's workers, consumers, farmers and firms. Rebalancing our trade policies so that they create and retain good jobs here at home --- along with fostering sustainable equitable development worldwide --- is an urgent challenge. The dramatic economic downturn caused in part by the lack of prudent global regulation of commerce, and massive trade and financial imbalances, demonstrates why America needs a new way on trade. It will be challenging to remedy the considerable damage that our past policies have wrought, however we are confident that working together, we can replace the failed trade policies of the past with those that deliver broadly shared benefits.

The recent election demonstrated a relentless demand from the American public for trade reform. Across the country, from the Presidency to both chambers of Congress, successful candidates in 2008 ran against the failed status quo and for a new approach. With this election, 42 newly elected Senators and Representatives committed to changing our past trade model. They join over two dozen fair traders elected in 2006 --- making a combined total of 71 fair-trade reformers who replaced those supporting the North American Free Trade Agreement (NAFTA), the Central America Free Trade Agreement (CAFTA) and our current China trade policies. The unprecedented election focus on reform reflects the public opinion that America's trade model needs a major overhaul. Nearly three-quarters of Americans believe that a "free trade agreement" has had a negative effect on their families. Majorities oppose NAFTA across every demographic. GOP voters, by a two-to-one majority, agree that "[f]oreign trade has been bad for the US economy, because imports from abroad have reduced demand for American-made goods, cost jobs here at home, and produced potentially unsafe products."

As the new Congress begins, we look forward to working with you and the Obama administration to seize this exciting opportunity to create better rules for our trade and globalization policy.

Correcting US --- China Commercial Relations: A key priority is speedy passage of legislation that applies our trade laws to counter China's currency manipulation. We also are eager to work with you to support the Administration as it prioritizes remedying this pervasive problem by engaging China at the highest level. Our immense trade imbalance with China --- $256 billion in 2007 --- is but one of the harmful effects of China's currency devaluation policy. The Yuan is substantially undervalued. Fair trade is not possible when currency policy manipulates the price of Chinese goods, flooding our markets with imports while pricing US goods out of China.

Further, President Bush's last-minute negotiations with China to establish a new Bilateral Investment Treaty (BIT) should be halted, with priority and resources shifted to resolving the currency issue. With many in Congress calling for an end to existing loopholes that promote offshoring, the United States should not engage in negotiations of a treaty designed to provide new protections to assist US firms' relocation of investment and jobs to China. The BIT would also empower Chinese firms, including state-owned firms, to increase purchases of US assets under preferential terms with new rights to skirt US courts and use foreign tribunals to challenge regulation of Chinese firms operating here. This is not the change in trade policy the public demanded in this election.

We are also eager to work with Congress and the Obama Administration to create new import-safety policies to ensure food and goods coming from China (and all countries) meet US safety and inspection requirements as a condition of entering our market and homes, where our families are exposed to unacceptable risks from imported products under current policy.

The WTO Doha Round Agenda: We are excited to work with you and the Obama administration to create a new agenda for future global trade talks aimed at addressing the existing problems in the current World Trade Organization (WTO) rules. Talks on the long-beleaguered "Doha Round" agenda should be halted. The Doha Round, if concluded, would expand the damage the WTO has already wrought. Since establishment of the WTO and NAFTA, the US trade deficit jumped exponentially from under $100 billion to over $700 billion --- over 5 percent of national income. At the same time, US real median wage growth has flattened despite impressive productivity gains. President Obama's goal of adding labor rights to WTO is not even on the Doha Round agenda. Meanwhile, among the concessions demanded of the United States under the current talks are both the unacceptable weakening of existing US domestic trade laws and WTO-binding of guaranteed new US visas for foreign workers seeking employment here. Moreover, a key element of the Doha Round agenda is further service-sector deregulation and liberalization --- including financial services and energy. As Congress and the world at large struggle to reregulate financial services and create new energy policies to ensure our nation's future, it is extremely counterproductive to permit imposition of new WTO limits on the domestic policy space needed in these critical areas. Indeed, a new WTO negotiating agenda must focus on creating the flexibilities needed to address the critical issues of our time, including policies to counter global climate change.

Hangover Bush Administration Free Trade Agreements (FTAs): The Free Trade Agreements with Colombia, Panama and Korea represent more-of-the-same trade-agreement model promoted by the previous administration. During the campaign, President Obama described changes to NAFTA and the NAFTA model FTAs that he would achieve through renegotiations of some existing agreements. The issues he raised have been the basis of congressional opposition to NAFTA-style pacts: excessive foreign-investor privileges and private enforcement systems, limits on domestic procurement policy and food safety protections, and more. President Obama's promise to renegotiate NAFTA, CAFTA and other pacts --- and the longstanding interest by many in Congress to improve the US trade-agreement model --- provides a long-overdue opportunity for in-depth reviews of the existing FTAs and the much-needed debate about what policies all US trade agreements should and should not include. Getting the rules right is critical before considering any future agreements, much less before negotiating additional pacts. Thus, for instance, the Bush Administration's new FTA negotiations launched in September 2008 with the Trans-Pacific Strategic Economic Partnership (Brunei, Chile, New Zealand and Singapore) should be halted.

While the three Bush FTAs contain some improvements relative to NAFTA, many of the most serious problems of the previous trade agreement model are replicated in the three Bush FTAs and must be addressed. The failure to remove these problematic provisions means these pacts do not pass the most conservative "do no further harm" test.

• Foreign-Investor Rights The investment chapters of the three Bush FTAs still afford foreign investors greater rights than those enjoyed by US investors. These three pacts' foreign-investor chapters contain the same provisions in CAFTA that led many Democrats to oppose that pact and that President-elect Obama cited as problematic during the campaign. Such provisions promote off-shoring, and subject our domestic environmental, zoning, health and other public interest policies to challenge by foreign investors in foreign tribunals.

• Food-Safety Provisions The Bush FTAs still contain language requiring the United States to limit import inspection and accept imported food that does not meet our domestic safety standards.

• Procurement Provisions The Bush FTAs procurement rules subject many common federal and state procurement policies to challenge and directly forbid other common procurement policies. These procurement rules continue the NAFTA/CAFTA ban on anti-off-shoring and Buy America policies, and expose US renewable-energy, recycled-content and other environmental safety requirements to challenge. These terms must be changed to provide the policy space for the many exciting "Green Economy" proposals promoted by President-elect Obama during his campaign.

• Agriculture Provisions The FTAs contain the NAFTA-style agriculture trade rules that have simultaneously undermined US producers' ability to earn a fair price for their crops at home and in the global marketplace. Multinational grain-trading and food-processing companies have made enormous profits, while farmers on both ends have been hurt. If this model is continued, hunger is projected to increase, along with illicit drug cultivation, and undocumented migration. Moreover, it would be an extension of the race to the bottom in commodity prices, pitting farmer against farmer and country against country to see who can produce food the cheapest, regardless of labor, environment or food-safety standards.

• Access to Medicines While the most egregious, CAFTA-based terms limiting access to affordable medicines have been removed from the Bush FTAs, the texts still include NAFTA-style terms that undermine the right to affordable medicines that were contained in the WTO's Doha Declaration.

In addition to the NAFTA-style provisions contained in Bush's Colombia, Panama and Korea FTAs, each agreement poses its own considerable problems.

The Colombia FTA: For instance, labor and human rights conditions in Colombia have worsened: the rate of unionist assassinations is up relative to 2007. Additionally, there are growing revelations about the Uribe Administration's links to rightwing paramilitaries responsible for assassinations of unionists, Afro-Colombian and indigenous community leaders. During Uribe's administration, 434 unionists have been murdered. More than 2,590 Colombian trade unionists have been killed since 1986. Since President Uribe took office five years ago, convictions have been reported in only 59 of the 458 trade-union homicide cases and only 55% of those convicted are in custody. It is critical to send a signal to the world that the United States has a zero-tolerance policy regarding assassination of people seeking to exercise their basic labor and human rights.

The Panama FTA: Meanwhile, Panama's economy thrives on banking secrecy and money laundering. Panama has been a key target of both the OECD and the G7-created Financial Action Task Force for its resistance to international norms in combating tax evasion and money laundering. Panama's "comparative advantage" is the ease with which US companies can create local subsidiaries there for the purpose of dodging US taxes. With 400,000 registered corporations, Panama is second only to Hong Kong as a home for multinational firms' subsidiaries --- many created for the sole purpose of avoiding taxes. Unlike all other US FTA partner-countries, and despite vigorous US complaints since the 1990s about Panama's murky banking sector and lack of corporate accountability rules, the Panamanian government has explicitly refused to sign the standard Tax Disclosure Treaty with the United States. This agreement, designed by the OECD and G-7 Financial Action Task Force, is used worldwide to catch tax cheats and prevent money laundering and funding for terrorists.

The Korea FTA: In addition to lopsided auto provisions, the Korea FTA includes major financial service sector deregulation and liberalization provisions which contradict global and domestic congressional efforts to reregulate this volatile sector.

We are all eager to support trade agreements that benefit a majority of US workers, farmers, small businesses and consumers. We all want American trade and globalization policies that promote the larger societal goals of economic justice, poverty alleviation, healthy communities, human rights and a sound environment that we all share. We believe that the 2008 Trade Reform, Accountability, Development and Employment (TRADE) Act --- put forward in the 110th Congress by Senator Sherrod Brown, Representative Mike Michaud and over eighty of their House and Senate colleagues --- offers a helpful roadmap for new policies that could rebuild a consensus in favor of expanded trade.

Correcting our past trade and globalization policy mistakes and moving forward on a new path can help our nation face our considerable economic challenges. Changing our current trade agreements and policies is critical to regain the policy space to accomplish key domestic non-trade priorities regarding health care, economic stability, climate change and more. We look forward to working with members of Congress and the Obama Administration to create a new American trade and globalization policy that can ensure that future trade agreements obtain broad support.

Sincerely,