Union leaders: ‘devil is in the details’ on new US-Mexico trade deal
For the five AFL-CIO union leaders who sat down with GOP President Donald Trump to talk NAFTA last week, “the devil is in the details” of the U.S.-Mexico so-called “free trade” framework the two nations unveiled on August 26.
But a top trade expert, former trade attorney Lori Wallach, now director of USPirg’s Global Trade Watch, is a lot more skeptical. She questions whether the framework has real enforcement mechanisms, among other problems.
By contrast, Jerry Dias, head of the Canadian Auto Workers union Unifor, called the framework “a good first step” – even though Canada was left out in the cold in the talks. That’s not what the five U.S. leaders said, though.
“We are aggressively engaged in pursuing an agreement that works for working people in all three countries, and we are not done yet. There is more work that needs to be done to deliver the needed, real solutions to NAFTA’s deeply ingrained flaws,” warned the five: AFL-CIO President Richard Trumka, Steelworkers President Leo Gerard, Auto Workers President Gary Jones, Machinists President Bob Martinez and Communications Workers President Chris Shelton.
Other union presidents, either in or out of the prior week’s Oval Office meeting, declined immediate comment.
“Any new deal must raise wages, ensure workers’ rights and freedoms, reduce outsourcing and put the interests of working families first in all three countries,” the five union leaders continued. “And working people must be able to review the full and final text and have the confidence not only in the terms of the deal, but its implementation, monitoring and enforcement. We remain committed to working with the administration to get NAFTA right. Our members’ jobs depend on it.”
Trump announced the framework, which he promptly renamed, in an Oval Office press conference with his trade representative, Robert Lighthizer, and with retiring Mexican President Enrique Pena Nieto on speakerphone. The two spent their time praising each other’s negotiators. Trump also dumped the NAFTA name.
The framework they reached calls for increasing North American content of vehicles – cars and trucks – from 62.5 percent to 75 percent and specifies that 40 percent-45 percent of each vehicle must be constructed by workers earning at least $16 an hour.
That particularly caught Dias’ attention, since “yellow unions” in Mexico sign contracts with auto firms there which pay Mexican laborers far less. The newest one – which Dias said now can’t take effect unless wages really shoot up – calls for a planned BMW plant in Mexico, building cars for export here, to pay workers $1.10 an hour.
According to a USTR fact sheet, other provisions of the “preliminary agreement in principle” – Lighthizer’s words – between the U.S. and Mexico also includes “a labor chapter that brings labor obligations into the core of the agreement, makes them fully enforceable, and represents the strongest provisions of any trade agreement.”
“The labor chapter includes an Annex on Worker Representation in Collective Bargaining in Mexico, under which Mexico commits to specific legislative actions to provide for the effective recognition of the right to collective bargaining,” Lighthizer’s fact sheet adds.
“The labor chapter requires the parties to adopt and maintain in law and practice labor rights as recognized by the International Labor Organization, to effectively enforce their labor laws, and not to waive or derogate from their labor laws.”
Lighthizer was not specific about which ILO labor rights both the U.S. and Mexico must adopt, maintain and enforce. And his summary has no mention of the Canadian government’s initial demand the U.S. outlaw so-called “right to work” laws.
The Canadians originally said RTW undercut wages so much that just as U.S. firms shifted factories and jobs south of the Mexican border to exploit low Mexican pay and lax environmental rules, Canadian firms shifted their plants and jobs south of the U.S. border to grab at lower pay in RTW states.
Trump wanted to get the deal done both to fulfill a campaign promise – a pledge that helped him get half of unionists’ votes in key Midwestern industrial states whose electoral votes in turn sent him to the White House – and to meet a legal deadline. If he didn’t get a “new NAFTA” to Congress before Labor Day, it could slide into the next Congress, which might have a pro-worker anti-NAFTA House majority.
Rep. Marcy Kaptur, D-Ohio, whose district has lost thousands of industrial jobs to NAFTA, and who joined unions and workers in fighting it a quarter of a century ago, also evoked the “devil in the details.” She also reminded Trump he can’t claim victory yet, as Congress must still approve it.
“The details and the fine print matter more than a hasty self-proclaimed victory,” she said. “As someone who fought with all I had to prevent NAFTA’s passage and the trauma it wrought on American workers, I know the devil is in the details. I look forward to reviewing the details of this agreement as well as the issues that remain with Canadian negotiators in the days and weeks to come,” Kaptur concluded.
While the U.S. union leaders were skeptical, Global Trade Watch’s Wallach was much more so.
“As we’ve made clear since Day One, an acceptable deal must remove NAFTA’s job outsourcing incentives,” she said in urging signers for a petition “demanding a NAFTA replacement that puts people and the planet before corporate greed.”
“Progress was made,” Wallach conceded, “but the enforceability of the new labor standards to which the countries agreed is still lacking, which is a serious problem that needs to be resolved.”
“Mainly though, we do not have enough detailed information to determine if this initial U.S.-Mexico deal can be the basis for the real NAFTA replacement we’ve been demanding that could stop NAFTA’s serious, ongoing damage.”
“More American jobs continue to be outsourced to Mexico every week, and already almost 1 million American jobs are certified by the government as lost to NAFTA -- and that’s even an undercount.”
“A NAFTA replacement must remove corporations’ Investor-State Dispute Settlement (ISDS) powers to attack our environmental and health laws before tribunals of three corporate lawyers and obtain unlimited sums of taxpayer awards.”
“And it must add strong labor and environmental standards with swift and certain enforcement to raise wages. Otherwise, U.S. corporations will keep moving jobs to Mexico to pay workers a pittance, dump toxins and import products back for sale here.”
Dias, in a televised interview with the Canadian affiliate of Bloomberg News, was more positive.
“If you increase” North American content of cars and trucks “to 75 percent, you’re creating jobs in North America,” he said. And the $16 hourly wage requirement for jobs building almost half those cars “should stop the mass exodus of jobs from Canada and the U.S. to Mexico.”
“There is no question Mexicans will lose some of those jobs” they gained from past auto and parts plant migration.
Not all was hunky-dory, however. “We need to deal with the overall labor issues in Mexico and the issue of free collective bargaining,” Dias said. What will happen there remains to be seen. Meanwhile, Canadian Foreign Minister Chrystia Freeland cut short her trip to Europe – which dealt with trade – on Monday to fly to Washington for talks with the U.S.
***
