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These stories were published Thursday, July 28, 2005, in Vol. 5, No. 148
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Costa Rica now has to decide
U.S. House hands Bush a victory with trade OK

By the A.M. Costa Rica staff

The U.S. House passed the Central American free trade legislation Wednesday night 217 to 215. As expected, the bulk of the yes votes came from Republicans, and 187 of the no votes came from Democrats.

The approval in the House is a victory for President George Bush who made the trade legislation a personal crusade. Bush even showed up at the U.S. Capitol early Wednesday to personally ask Republicans and some Democrats to vote for the bill. The U.S. Senate already has passed the measure. All that is lacking is a signature by Bush.

The two-vote margin was really less dramatic than it seemed. At least a dozen Republicans were ready to support the measure if the leadership needed their vote. Due to local political concerns, they preferred to vote against the bill if they could do so without jeopardizing the president's project.

According to Scott McClellan, the president's press secretary, Bush told the congressmen that the free trade agreement known as CAFTA has strategic implications for the Western Hemisphere because it will help to support and strengthen emerging democracies in the region. The president "also talked about how trade expands opportunity and lifts people out of poverty," which also will create more job opportunities at home and make families less likely to emigrate, McClellan said earlier in the day. Bush told the congressmen that the measure also will help "level the playing field" for American workers by eliminating or severely reducing trade barriers to U.S. products in Central America and the Dominican Republic.

Approval in the United States and the signature of President Bush will put the agreement into force. Guatemala, El Salvador and Honduras already have ratified the measure. The trade agreement will go into effect Jan. 1. The Congressional Budget Office estimated that implementing the agreement would reduce U.S. revenues by $3 million in 2006, about $1.1 billion over the 2006-2010 period, and about $4.4 billion over the 2006-2015 period. The budget office also estimated that the trade pact also would increase direct spending by $27 million in 2006, $245 million over the
How members
of the House voted
BELOW!


2006-2010 period, and $621 million over the 2006-2015 period. Some of the government spending would be in income subsidies to U.S. sugar producers who would face pressure from more imports. The lost income would be from the reduction and elimination of import duties on goods and products from Central America. In other words, this is money that U.S. consumers will not have to pay.

According to the U.S. International Trade Commission (USITC), the United States collected $518 million in customs duties in 2004 on $17.7 billion of imports from those six countries. Much of the imports from Central America are duty-free now. But preferential trade programs will expire next year and in 2008. The full effect of the trade pact will not be felt for at least 20 years.

Passage in the United States puts pressure on Costa Rican President Abel Pacheco who, so far, has resisted sending the pact that his administration negotiated to the Asamblea Legislativa for ratification. Neither Nicaragua nor the Dominican Republic have ratified the measure although those governments also have signed the agreement.

Some 15 Democratic members of Congress voted for the measure. The 27 Republicans who voted against it were joined by two Republicans who did not vote. Republicans voting for the measure were 202.

The battle lines were pretty well drawn in the House chamber. Unions, sugar beet growers and others with negative interest in the legislation were urging their representatives to reject the measure. U.S. textile manufacturers supported the bill. The House Republican leadership was pretty certain of victory before they put the measure on the floor for a two-hour debate starting at 8:15 p.m. Washington time.

A special resolution specified a short period of debate and other rules for considering the bill.

The final act was a roll call vote that was not fully recorded until shortly after midnight.


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San José, Costa Rica, Thursday, July 28, 2005, Vol. 5, No. 148

 
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Our readers on trade pact

He favors elimination
of import tariffs


Dear A.M. Costa Rica:

I have been reading the letters in A.M Costa Rica concerning the free trade agreement. Many of them cite reasons for not ratifying it which are actually the best reasons for ratification.

First of all, some facts: Costa Rica has about 4 million people, a GDP of 35 billion USD and per capita income of 4,000 (USD)  Although all these numbers are higher because of a thriving underground economy generating almost $8 billion per year.

I make this point because a recent writer hit all the points very well but incorrectly. David Mesmer says “it is all about the money” refering to the greed of U.S. corporations.  Unfortunately,  the Costa Rica market is about 10 percent of Chicago where per capita income is 30,000 (USD) for almost 10 million people.  So if I am a U.S. or multi-national corporation I would not even consider investing money to tap the Costa Rican market if there were any impediments to trade and investment.

Secondly, the loss of government income from tariffs and import duties would be the best thing that could happen to the Costa Rican people. I am amazed that many things I buy in Costa Rica are priced significantly above the price here in Chicago. While there are many factors, the tariffs are among the highest proportion of this price differential.  So in fact the tariffs make the Costa Rican people less weathly because they cannot afford the imported goods, and domestic production and pricing (if any) are artifically inflated. Tariffs generally only penalize the consumer not the importer.  If the tariff’s were removed, this would probably lower inflation, and, more importantly force, the government to improve its fair collection of taxes. An easy example of this is fishing equipment. I brought my guide a reel he said it would cost him over 100 dollars.  I paid $29.

In terms of the U.S. companies losing jobs and “needing to look for new markets,” this is ridiculous.  Most of the companies he refers to (General Motors, Kodak and Hewlett Packard) are companies which did not manage their business well and need to restructure to survive.  Some of this delayed response is due to U.S. tariffs on goods (steel and  foreign cars) 10 and 20 years ago.  Some is due to poor bargaining with the unions many years ago — overly generous pensions and health benefits, inflexible work rules and most importantly increases in productivity where less workers are needed to produce twice as much.

I do not think that 100 million in car sales in Costa Rica is going to save the automakers or film sales . . . Kodak (hey it is all digital now). Does he want this to  happen to Costa Rican companies in the future because they have no incentive to remain productive.

Maybe the reduction of tarifs, and the opening of markets will force the old and inefficient industries in CR to modernize. Maybe a non-CR company will help it’s Costa Rican partners invest in modernizing its plant.  Maybe competition in electrictiy (I know, sacred cow), and telecommunications will put more people to work, better service and lower prices. Or maybe General Motors will move a plant down here and produce cars for all of Central America at a price that the average worker can afford.

The problem is that the status quo will be more of the same.  Is that what the Costa Rican people want?  Change and improvement will not come without the sacrifice of more than a few, but the good of the country will be served.

Costa Rica has the best education system, the most stable government and legal system and the hardest working people in Central America.  Who do you think the winner will be if the trade agreement is ratified.

Tom Harrison
Chicago
  
He says corporations
will ruin environment


Dear A.M. Costa Rica:

I’d like to make a not so bold prediction of what I think will be one result of the passage of CAFTA in Costa Rica:

Not long after its passage, a large, greedy American corporation will sue the Costa Rican government, claiming it is being restricted from operating profitably, because of the environmental requirements.  The Costa Rican government, by virtue of its inability to finance large international lawsuits, will be forced to accede to the wishes of the Corporation.  This will be the beginning of the end for the Costa Rican environment.

American developers would like nothing better than to turn the coastlines into the kinds of concrete monstrosities they have built in Florida, Hawaii, and along the Gulf Coast. And let’s not forget the high-density, time-share condos in the mountains.  It may create jobs alright, but you can bet the money won’t stay here.

In my opinion, this agreement must not be approved until it guarantees Costa Rica will maintain its sovereignty and along with it the ability to preserve its culture and environment.

Ralph Antonelli
Platanillo
Computer robbery trio
given pre-trial detention

By the A.M. Costa Rica staff

Three men accused of stealing laptop computers were remanded to pretrial detention, officials with the Poder Judicial said Wednesday.  The detention will last three months. 

Ruddy Alberto Morúa Torres, Josías Soto Espinoza and Salvador Obando Fernández are charged with stealing laptop computers by robbing them from unsuspecting victims, officials said.   

The suspects were arrested in Hatillo where officials say they found important evidence including three kilograms of cocaine and a firearm.  As a result, Obando Fernández was also charged with drug possession, officials said. 

Police said the robbers operated primarily in the center of San José and around the city's universities. 

There have been a number of robberies of laptop computers in the last three months. Investigators think that at least 40 can be attributed to the three men they arrested this week.

Because the computer robbers used firearms, officials were anxious to close the case before someone was hurt.

City band will play tonight

By the A.M. Costa Rica staff

The Band of San José is scheduled to perform in the Catedral Metropolitana tonight with guest director Carlos Dieguéz from Spain.  The show starts at 6 p.m.

Dieguéz is the latest in a line of foreign directors who have come to Costa Rica to teach their brand of music, said a press release. 
Professional Directory
A.M. Costa Rica's professional directory is where business people who wish to reach the English-speaking community may invite responses. If you are interested in being represented here, please contact the editor.


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Tempisque bridge toll may be as high as 600 colons
By the A.M. Costa Rica staff

The bridge was a donation from the government of Taiwan, but a legislative committee is working on a bill that would levy a toll, ostensibly to keep the bridge in good repair.

However, at least one lawmaker thinks that the money will end up going elsewhere.

It was in the Comisión Permanente de Asuntos Económicos where the proposal was discussed Wednesday. A proposed bill would set a 600-colon toll for normal traffic on the span over the Río Tempisque. That is about $1.25 at the current exchange rate. The fee would be set by an executive decree until the nation's price regulating agency could consider the matter. Trucks would pay more.

But Aida Faingezicht, a member of the Asamblea Legislativa, was one who objected. Speaking of the Consejo Nacional de Vialidad which maintains the roads, she said: "The fact is that this money within CONAVI is practically a guarantee that this money is not going to be spent — since the Sala IV issued a
 decision that established that the Ministerio de Hacienda does not have the obligation to expend the money according to specific laws, and this is not the fault of the minister or the ministry, it simply is that the money that we send to CONAVI is used for other necessities."

The bridge has become a key route to the central Nicoya Peninsula. Until the bridge opened in early 2003, motorists avoided the longer route through Liberia by taking a ferry just south of where the bridge stands today. The 780-meter bridge (nearly a half mile) cost $27 million.

A supporter of the bill is Bernal Jiménez, who spoke Wednesday; "In this country we ought to assume the responsibility of paying for our public possessions and the only way to move ahead is that we pay for them. It is what this bill tries to do. Otherwise, the bridge in a few years will deteriorate due to use."

Committee members were swayed by the idea of collecting a toll and sent the measure to the floor of the assembly for consideration and a vote. The bill may be amended there.


U.S. image will be getting a public relations makeover
By the A.M. Costa Rica wire services

Karen Hughes, the incoming undersecretary of State for public diplomacy, has the task of trying to improve the U.S. image abroad, and one area of concern is Latin America. Relations with most countries in this region have been close and friendly, but there are some challenges emerging.

In the 1980s, when the Cold War dominated foreign policy, U.S. attention was focused intently on such places as Grenada, Nicaragua, El Salvador and Panamá. Then the Soviet Union collapsed and democratic governments came to power throughout the Western Hemisphere, with the notable exception of Communist Cuba, where President Fidel Castro was left isolated and struggling with a collapsed economy.

More recently, the threat of terrorism and combat in Iraq and Afghanistan have focused U.S. policy on the Middle East. Vera Kutzinski, director of the Center for the Americas at Vanderbilt University in Nashville, Tenn., says that, as a result, the United States has neglected its neighbors.

"The United States has not really been paying as much attention to Latin America and the Caribbean as it might have," she says.

She says U.S. influence has waned, and challenges to U.S. policies in the Americas have grown. She says Karen Hughes should take a good look at what has happened in the region, not only to bolster the U.S. image there, but also to see what has worked and what has not worked.

"There are some important lessons to be derived from our history of relationship building, successes and failures, in Latin America that would be instructive, I think, to Ms. Hughes and I hope she does consult that history closely," she says.

Aside from the Castro government in Cuba, the strongest opposition to U.S. policy in Latin America comes from Venezuelan President Hugo Chavez, who has announced plans to begin a television network in the region that some critics fear will be a platform for anti-U.S. rhetoric.

Julia Sweig, a Latin American specialist at the Washington-based Council on Foreign Relations, says oil-rich Venezuela has the means to be effective in such a venture and that Chavez's message may fall on willing ears.

"There is no doubt in my mind that the Chavez government has a strong anti-U.S. position and it has the money and resources to broadcast that position throughout Latin America," she says. "I think that will
represent a challenge because Latin America is fertile ground. Hugo Chavez does not have to move mountains to push Latin American opinion against the United States."

Something that undermined the U.S. image in the region, according to Ms. Sweig, was the failure of the U.S. government to strongly condemn a coup that briefly ousted  Chavez in April, 2002.

On the other hand, Ms. Sweig says the United States has done well in developing friendly relations with the left-leaning government of President Luis Inacio Lula da Silva in Brazil, even though he disagrees with U.S. trade policy.

Julia Sweig says U.S. neglect of the region cannot be undone through public diplomacy efforts alone.

"Public relations without substantive policy will do nothing to help us, in fact, it might backfire," she says.

U.S. officials, however, say Washington is matching its words with deeds and that relations with other nations in the Americas are based on longstanding programs of cooperation and assistance.

Roger Noriega, assistant secretary of State for Western Hemisphere affairs, in a recent exchange with Latin American journalists, noted that academic exchange programs have flourished and proven to be beneficial to both the United States and the other countries involved. He also emphasized the U.S. commitment to free trade as a way of breaking down barriers and spreading prosperity to all strata of Latin American society.

Noriega testified before a U.S. House committee Wednesday and said that the United States is willing to work with all nations throughout the Americas interested in strengthening their political institutions and implementing economic reforms to take advantage of trade opportunities.

Noriega cited several examples of U.S. diplomatic challenges in the region, including the establishment of a free-trade agreement with Central America and the Dominican Republic and supporting Colombia's efforts to confront terrorism and the narcotics trade.

The State Department official said that Colombia is one of the United States' strongest allies in Latin America.  As Colombia continues to confront the narcotics trade and terrorism, it also has remained "a vibrant democracy and a force for progress and stability in the Andes, serving as an important counterweight to less positive trends in the region," he said.

 
Here's how the House voted on the Central American free trade pact
According to the clerk of the U.S. House, these 217 representatives voted in favor of the Dominican Republic-Central America-United States Free Trade Agreement Implementation Act

Aderholt
Akin
Alexander
Bachus
Baker
Barrett (SC)
Bartlett (MD)
Barton (TX)
Bass
Bean
Beauprez
Biggert
Bilirakis
Bishop (UT)
Blackburn
Blunt
Boehlert
Boehner
Bonilla
Bonner
Bono
Boozman
Bradley (NH)
Brady (TX)
Brown (SC)
Brown-Waite, Ginny
Burgess
Burton (IN)
Buyer
Calvert
Camp
Cannon
Cantor
Carter
Castle
Chabot
Chocola
Cole (OK)
Conaway
Cooper
Cox
Crenshaw
Cuellar
Culberson
Cunningham
Davis (KY)
Davis, Tom
Deal (GA)
DeLay
Dent
Diaz-Balart, L.
Diaz-Balart, M.
Dicks
Doolittle
Drake
Dreier
Duncan
Ehlers
Emerson
English (PA)
Everett
Feeney
Ferguson
Fitzpatrick (PA)
Flake
Foley
Forbes
Fortenberry
Fossella
Franks (AZ)
Frelinghuysen
Gallegly
Gerlach
Gibbons
Gilchrest
Gillmor
Gingrey
Gohmert
Goodlatte
Granger
Graves
Green (WI)
Hall
Harris
Hart
Hastert
Hastings (WA)
Hayes
Hayworth
Hefley
Hensarling
Herger
Hinojosa
Hobson
Hoekstra
Hulshof
Hyde
Inglis (SC)
Issa
Istook
Jefferson
Jenkins
Johnson (CT)
Johnson (IL)
Johnson, Sam
Keller
Kelly
Kennedy (MN)
King (IA)
King (NY)
Kingston
Kirk
Kline
Knollenberg
Kolbe
Kuhl (NY)
LaHood
Latham
LaTourette
Leach
Lewis (CA)
Lewis (KY)
Linder
Lucas
Lungren, Daniel E.
Manzullo
Marchant
Matheson
McCaul (TX)
McCrery
McKeon
McMorris
Meeks (NY)
Mica
Miller (FL)
Miller, Gary
Moore (KS)
Moran (KS)
Moran (VA)
Murphy
Musgrave
Myrick
Neugebauer
Northup
Nunes
Nussle
Ortiz
Osborne
Oxley
Pearce
Pence
Peterson (PA)
Petri
Pickering
Pitts
Platts
Poe
Pombo
Porter
Price (GA)
Pryce (OH)
Putnam
Radanovich
Ramstad
Regula
Reichert
Renzi
Reynolds
Rogers (AL)
Rogers (KY)

Rogers (MI)
Rohrabacher
Ros-Lehtinen
Royce
Ryan (WI)
Ryun (KS)
Saxton
Schwarz (MI)
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Skelton
Smith (TX)
Snyder
Sodrel
Souder
Stearns
Sullivan
Sweeney
Tanner
Terry
Thomas
Thornberry
Tiahrt
Tiberi
Towns
Turner
Upton
Walden (OR)
Walsh
Wamp
Weldon (FL)
Weldon (PA)
Weller
Westmoreland
Whitfield
Wicker
Wilson (NM)
Wilson (SC)
Wolf
Young (AK)
Young (FL)


The House clerk said these 215 representatives voted no.

Abercrombie
Ackerman
Allen
Andrews
Baca
Baird
Baldwin
Barrow
Becerra
Berkley
Berman
Berry
Bishop (GA)
Bishop (NY)
Blumenauer
Boren
Boswell
Boucher
Boustany
Boyd
Brady (PA)
Brown (OH)
Brown, Corrine
Butterfield
Capito
Capps
Capuano
Cardin
Cardoza
Carnahan
Carson
Case
Chandler
Clay
Cleaver
Clyburn
Coble
Conyers
Costa
Costello
Cramer
Crowley
Cubin
Cummings
Davis (AL)
Davis (CA)
Davis (FL)
Davis (IL)
Davis (TN)
DeFazio
DeGette
Delahunt
DeLauro
Dingell
Doggett
Doyle
Edwards
Emanuel
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Ford
Foxx
Frank (MA)
Garrett (NJ)
Gonzalez
Goode
Gordon
Green, Al
Green, Gene
Grijalva
Gutierrez
Gutknecht
Harman
Hastings (FL)
Herseth
Higgins
Hinchey
Holden
Holt
Honda
Hooley
Hostettler
Hoyer
Hunter
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jindal
Johnson, E. B.
Jones (NC)
Jones (OH)
Kanjorski
Kaptur
Kennedy (RI)
Kildee
Kilpatrick (MI)
Kind
Kucinich
Langevin
Lantos
Larsen (WA)
Larson (CT)
Lee
Levin
Lewis (GA)
Lipinski
LoBiondo
Lofgren, Zoe
Lowey
Lynch
Mack
Maloney
Markey
Marshall
Matsui
McCarthy
McCollum (MN)
McCotter
McDermott
McGovern
McHenry
McHugh
McIntyre
McKinney
McNulty
Meehan
Meek (FL)
Melancon
Menendez
Michaud Millender-McDonald
Miller (MI)
Miller (NC)
Miller, George
Mollohan
Moore (WI)
Murtha
Nadler
Napolitano
Neal (MA)
Ney
Norwood
Oberstar
Obey
Olver
Otter
Owens
Pallone
Pascrell
Pastor
Paul
Payne
Pelosi
Peterson (MN)
Pomeroy
Price (NC)
Rahall
Rangel
Rehberg
Reyes
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Sabo
Salazar
Sánchez, Linda T.
Sanchez, Loretta
Sanders
Schakowsky
Schiff
Schwartz (PA)
Scott (GA)
Scott (VA)
Serrano
Sherman
Simmons
Simpson
Slaughter
Smith (NJ)
Smith (WA)
Solis
Spratt
Stark
Strickland
Stupak
Tancredo
Tauscher
Taylor (MS)
Thompson (CA)
Thompson (MS)
Tierney
Udall (CO)
Udall (NM)
Van Hollen
Velázquez
Visclosky
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Wexler
Woolsey
Wu
Wynn

These representatives did not vote:  Davis, Jo Ann and Taylor (NC).
 

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