New trade pact not universally backed

Bill Knight column for 1-23, 24 or 25, 2020

Although the U.S. Senate last week approved the negotiated version of the U.S.-Mexico-Canada Agreement (USMCA), labor unions and environmentalists weren’t unanimous in their enthusiasm.

True, the AFL-CIO praised the rewritten trade deal, but the federation also conceded that “it alone is not a solution for outsourcing, inequality or climate change.”

That’s reminiscent of the old joke where a police officer pulls over a driver for running a stop sign, and the motorist says he shouldn’t be ticketed because he did slow down. Then the policeman pulls his baton and start clubbing the driver, who complains.

The officer says, “Do you want me to slow down or stop?”

Working Americans want unfair trade and outsourcing, inequality and climate change to stop, not just slow.

 “The changes embodied in the USMCA still constitute Band-Aids on a fundamentally flawed agreement and process,” said Thea Lee of the Economic Policy Institute (EPI). “The USMCA will in no way offset or reverse the massive devastation caused by the original NAFTA agreement.”

The USMCA, expected to be signed by President Trump any day, could be beneficial to workers in a few industries, and it’s at least somewhat possible for labor rights in Mexico to improve. However, such changes are neither guaranteed nor will affect incomes for U.S. workers, as acknowledged by the United States International Trade Commission’s USMCA report.

Replacing the 25-year-old North American Free Trade Agreement (NAFTA), the “New NAFTA” was considered earlier than originally scheduled after Senate Majority Leader Mitch McConnell exploited delays in President Trump’s impeachment trial and backtracked on his previous plan.

The U.S. House last month approved legislation to implement the USMCA in a 385-41 vote, with 192 Republicans and 193 Democrats supporting it, and 2 Republicans and 38 Democrats voting against it.

Illinois Congressman Jesus “Chuy” Garcia said, “I hoped the USMCA would significantly improve on the inadequate labor and environmental protections in NAFTA.”

However, it didn’t satisfy the Chicago Democrat, so he was the only no vote out of Illinois’ Congressional delegation.

Some in organized labor also aren’t convinced.

“The USMCA remains a tool for corporate interests and provides insufficient relief to address the problems for working people,” said Carl Rosen of the United Electrical, Radio and Machine Workers of America. “The USMCA will still allow corporations to move their work to the locations with the lowest standards for workers and the environment while limiting the abilities of democratically-elected governments to uphold the interests of working people.”

About 1 million jobs were lost after NAFTA, according to EPI and the U.S. Labor Department, mostly due to factories moving to Mexico, and imports increasing. NAFTA also contributed to wage decline (since well-paid manufacturing workers were forced to accept other jobs paying less), and cheaper consumer goods on foreign-made goods haven’t made up for the lost income.

The Machinists also criticized the USMCA.

“As we 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,” said Machinists president Bob Martinez. “Unfortunately, we are not aware of provisions in the newly negotiated agreement that effectively address this matter.”

Lori Wallach, director of Public Citizen’s Trade Watch, said the agreement “won’t bring back the jobs that we lost.”

The United Auto Workers took a neutral position, recognizing that the proposal would increase North American content for vehicles to 70% and mandates those cars and trucks be made by workers whose average pay is $16 an hour, but UAW President Rory Gamble also said, “Companies intent on keeping wages down will go to great lengths to keep wages down and jobs in Mexico.”

Elsewhere, the proposed agreement has virtually no support from leading environmental groups, who feel it doesn’t “meaningfully address climate change.”

Ten environmental organizations had signed an appeal to Congress to reject the USMCA, saying, “This final deal poses very real threats to our climate and communities. The deal does not even mention climate change, fails to adequately address toxic pollution, includes weak environmental standards and an even weaker enforcement mechanism, supports fossil fuels, and allows oil and gas corporations to challenge climate and environmental protections.”

Meanwhile, Communications Workers president Chris Shelton also reserved judgment, commenting, “While a net improvement, the USMCA is not a future template for a progressive vision of trade that puts at its core our values of good jobs and rising wages.”