The Building Tradesman Newspaper

Friday, January 10, 2020

AFL-CIO's blessing gives 'New NAFTA' new momentum

By The Building Tradesman

By Mark Gruenberg
PAI Staff Writer

WASHINGTON (PAI)—The AFL-CIO announced last month it backs the revised “New NAFTA,” the so-called “free trade” pact GOP President Donald Trump and the U.S. House’s ruling Democrats unveiled Dec. 9.

The union federation and the president said the proposed pact, formally called the U.S.-Mexico-Canada Agreement (USMCA), has strong worker rights enforcement provisions within its own text.

But news reports say Trump’s price for yielding that was to give Big Pharma complete leeway to raise drug prices in all three countries – a move that could cost consumers billions of dollars and put products out of reach for the poor. 

AFL-CIO President Richard Trumka disputed that. He said Big Pharma did not win, but since the full text has not been disclosed, neither his comment nor Trump’s can be verified. Other unions, with the exception of the Machinists, expressed general satisfaction with the New NAFTA. Last year, Democratic leaders made it apparent that the deal would not happen without Trumka signing off on it.

“Make no mistake, we demanded a trade deal that benefits workers and fought every single day to negotiate that deal; and now we have secured an agreement that working people can proudly support. #USMCA,” Trumka tweeted.

The House of Representatives adopted the new NAFTA by a 385-41 vote to replace the 25-year-old North American Free Trade Agreement. The Senate will soon vote on the New NAFTA.

Trumka thanked House Speaker Nancy Pelosi, D-Calif., and Sens. Sherrod Brown, D-Ohio, and Ron Wyden, D-Ore., “for standing strong with us throughout this process as we demanded a truly enforceable agreement.” He also praised Trump’s top trade bargainer, Robert Lighthizer, “for being a straight shooter” in talks with unions and House Democrats.

“Working people are responsible for a deal that is a vast improvement over both the original NAFTA and the flawed proposal brought forward in 2017,” Trumka’s follow-up tweeted statement said.

“For the first time, there truly will be enforceable labor standards -- including a process that allows for inspections of factories and facilities that are not living up to their obligations.”

“The USMCA also eliminates special carve outs for corporations like the giveaway to Big Pharma in the administration’s initial proposal and loopholes designed to make it harder to prosecute labor violations,” he said. 

The Machinists, whose president, Robert Martinez, chairs the AFL-CIO’s International Affairs Committee, sang a different tune. They said the USMCA would not stop the continued outsourcing of U.S. jobs to Mexico. The Canadian Labour Congress, whose members took to the streets of Montreal last year against the USMCA, had no immediate comment. 

“As we have made clear from the very beginning of this process, any acceptable deal must effectively address the continued outsourcing of hundreds of thousands of jobs to Mexico,” Martinez said.

“Unfortunately, we are not aware of provisions in the newly negotiated agreement that effectively address this matter, especially when it comes to aerospace and other manufacturing sectors. We also remain troubled over other areas of the agreement that fall short of our repeated recommendations, such as those concerning stronger labor standards, enforcement and rules of origin.”

The labor-backed Economic Policy Institute says while the USMCA is slightly better than NAFTA, its changes “still constitute Band-Aids on a fundamentally flawed agreement and process.”

“Powerful multinational corporations have used and controlled the negotiation of trade and investment deals to facilitate off-shoring and the deregulation of the U.S. and global economy,” the think tank added, citing the Machinists’ analysis.  

And while federal analyses show the USMCA will result, at best, “in roughly 51,000 new manufacturing, mining, and farming jobs over the next six years,” that’s a far cry from the hundreds of thousands of factory jobs alone that NAFTA cost the U.S.

“The benefits are tiny, and it’s highly uncertain whether the deal will be a net winner or loser, in the end. As a result, the USMCA will in no way offset or reverse the massive devastation caused” in U.S. job and income losses from NAFTA.

“The USMCA may yield benefits for workers in a few industries, such as glass and steel. And it may result in significant improvements in labor rights for Mexican workers, which could help them in the long-run. But those changes will have virtually no measurable impacts on wages or incomes for U.S. workers,” the Economic Policy Institute concluded. 

A statement from the UAW said, "if the final text reflects the agreed upon language, it has improved significantly from when it was initially negotiated by the Trump administration because of the tireless work of Speaker Nancy Pelosi, Senator Sherrod Brown, Senator Ron Wyden, Senator Debbie Stabenow and Senator Gary Peters and the USMCA working group who fought to strengthen its labor standards and enforcement provisions. I also want to thank Ambassador Robert Lighthizer for his good-faith negotiations.

"But to be clear, much more work remains to fight against the off-shoring of jobs and the economic inequality that has plagued our country for so long."

Trump strong-armed both Mexico and Canada into the USMCA a year ago, over the opposition of U.S. and Canadian unions. He claimed it would be better for U.S. workers, due to writing labor standards into the pact and new rules for North American content for vehicles. 

But the AFL-CIO and other unions declared that without strong enforcement, written into the pact itself – not just the legislation approving it – the new rules are valueless, especially in low-wage, labor-repressive, little-regulation Mexico. 

That’s why U.S.-based corporations exported hundreds of thousands of jobs, in every industry from car factories to call centers, to Mexico, over NAFTA’s 25-year existence.

North America's Building Trades Union President Sean McGarvey said he applauded the bipartisan leadership of President Trump and Speaker Pelosi. "This agreement takes to heart the failures of NAFTA and provides a framework with real enforcement mechanisms that will help level the playing field and provide meaningful safeguards for workers, U.S. companies and entire communities...We remain hopeful this will foster goodwill to address challenges like our nation’s crumbling Infrastructure that will require the attention and cooperation of the Administration and Members of Congress from both parties.”