WASHINGTON—Over the Machinists’ objections, the AFL-CIO announced Dec. 10 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 that day.
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 Trump’s price for yielding on labor standards enforcement was to give Big Pharma complete leeway to raise drug prices in all three countries – a move that will cost consumers billions of dollars and put products out of reach for the poor. AFL-CIO President Richard Trumka disputed that point in his statement, however, saying that his reading of the new deal is that Big Pharma is not authorized to increase prices as much as it wishes. All the details of the agreement are not public yet so who is correct on this point is not yet discernible.
“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 at 7 am.
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 both unions and the 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 the 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.”
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. Nor did Mexican unions, including the independent Los Mineros.
“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. Our ability to comment in detail on this agreement is impaired because in the rush to consider such a proposal, we have not even been given the opportunity to review the full agreement in writing.”
“U.S. workers have been waiting over 25 years for a responsible trade deal that puts their interests ahead of corporations who are fleeing our shores. They are still waiting. The IAM will oppose NAFTA 2.0.”
The 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 offshoring 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 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,” EPI concluded.
As of mid-day Dec. 10, other unions that had been outspoken against the USMCA, including the Steelworkers and the Auto Workers, had yet to comment on the new pact. UAW was in the midst of a transition to a new president, Rory Gamble, its first African-American leader ever.
Trump strong-armed both Mexico and Canada into the USMCA a year ago, over the opposition of both 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 motor vehicles.
But the AFL-CIO and other unions declared that without strong enforcement, written into the pact itself – not just the legislation OKing it – the new rules are valueless, especially in low-wage, labor-repressive, little-regulation Mexico.
That’s why U.S.-based corporations exported between millions of jobs, in every industry from car factories to call centers, to Mexico, over NAFTA’s 25-year existence.
Meanwhile, the House Democrats said the revised USMCA pact met workers’ demands, and Pelosi said a vote on legislation to implement it could occur the week of December 18 – just days after the House plans to vote on impeaching Trump.
That gives foes of the USMCA very little time to stop it.
Pelosi also said that despite impeachment, the USMCA pact shows Congress and Trump could still work on key issues together. Left unsaid by the Dems: The new pact fulfills a key Trump campaign promise in 2016.
Then, GOP nominee Trump stumped key Midwestern industrial states railing against the original NAFTA and vowing to scrap it. That helped him win half the votes from workers and their families in the key states of Wisconsin, Michigan, Pennsylvania and Ohio.
He won 52% in the Buckeye State and the unionists’ votes were enough to give him narrow wins in each – and the Electoral College majority that put him in the Oval Office.
Ohio was one of NAFTA’s main victims, as the pact cost 286,322 Ohio factory workers their jobs, Public Citizen’s Trade Watch calculated. Other big losers included Illinois (118,553 jobs), Michigan (169,581), New York (389,123), California (384,406) and Pennsylvania (305,835).
That track record didn’t stop the Democrats from hailing the USMCA.
“We got the agreement, we’re going to go with it,” House Ways and Means Committee chairman Rep. Richard Neal (D-Mass.) said in an early-morning press conference on Dec. 10. His panel will handle the enabling legislation for the USMCA, which needs just simple majority votes in both the House and the Senate for the pact to take effect.
All sides assume the GOP-run Senate will easily approve the USMCA, especially since Wyden, whom Trumka thanked, is top Democrat on the Senate Finance Committee, which will also work on the enabling legislation. The Democratic-run House, which was more attentive to workers even when it narrowly passed the original NAFTA a quarter-century ago, was always going to be the political problem for Trump.
Ironically, Trump and the Democrats announced the USMCA just a few days after the 20th anniversary of the “Battle in Seattle.” There, worker-led protests against pro-corporate “neo-liberal” policies, including “free trade” pacts, first brought the issue of the costs to workers of such pacts to world attention. The Seattle fray forced a premature end to World Trade Organization meetings there.
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