PAGE 2 | September 7 , 2018 | NORTHWEST LABOR PRESS
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TRADE
An end to NAFTA?
President Donald Trump an-
nounced Aug. 27 that Mexican
and U.S. trade negotiators are in
preliminary agreement over
what appeared to be a new two-
nation trade deal that could take
the place of the three-nation
agreement known as NAFTA
(North American Free Trade
Agreement).
“We’re going to call it the
United States-Mexico Trade
Agreement, and we’ll get rid of
the name NAFTA,” Trump said
in a celebratory conference call
with Mexican president Enrique
Nieto. “It has a bad connotation
because the United States was
hurt very badly by NAFTA for
many years. And now it’s a really
good deal for both countries.”
Not so fast, said five national
labor leaders in a joint statement
reacting to the news. “The devil
is in the details,” they said.
“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.” The state-
ment was signed by AFL-CIO
President Richard Trumka,
United Steelworkers President
Leo Gerard, United Auto Work-
ers President Gary Jones, Ma-
chinists President Robert Mar-
tinez. Jr., and Communications
Workers of America President
Chris Shelton.
No official text of the new
U.S.-Mexico accord has been
released, or even officially
agreed to by the two sides, but
here’s what the Administration
has revealed so far about the
agreement:
■ To qualify for tariff-free treatment, 75
percent of the value of each car would
have to come from the United States or
Mexico — up from 62.5 percent under
NAFTA. [The content rule is meant to limit
the importation of auto parts from China
or other non-NAFTA countries.]
■ 40 to 45 percent of auto content would
have to be made by workers earning more
than $16 per hour. [Because Mexican auto
parts workers now average less than
$3.50 an hour, while U.S. autoworkers
average over $22 an hour, that rule would
result in either big raises for Mexican
workers, or increased U.S. content in cars
assembled in Mexico.]
■ NAFTA’s controversial Chapter 11 Investor-
State Dispute Settlement (ISDS) system
would be scaled back, and could be used
only in cases of expropriation or failure to
treat companies equally, or in sectors such
as oil, power and infrastructure. [NAFTA
critics say corporations have abused
NAFTA’s ISDS rules by suing governments
over environmental and other regulations
that reduce their expected profits, with
those cases decided by unaccountable
trade tribunals.]
■ Mexico would commit to reform union
rights — such that workers would
choose their unions and approve union
contracts via secret-ballot votes.
■ Unlike NAFTA, which has no sunset clause,
the new deal would be revisited every six
years, at which point the countries could
agree to extend it for 16 years.
“The Trump Administration
seems poised to dress up tweaks
as a meaningful change to the
NAFTA reality,” said Russell
Lum, organizer for the union-
backed Oregon Fair Trade
Coalition in a statement emailed
to the Labor Press. “Some of the
proposed tweaks we think
would be better, and some of
them worse, but to transform
NAFTA into something truly
beneficial, far more than tweaks
are needed.”
The new agreement leaves
unresolved the dispute over steel
and aluminum tariffs the Trump
Administration imposed on
Mexico earlier this year.
Even more importantly, it
leaves out Canada. Trump de-
manded that Canada agree to a
new deal by the Friday before
Labor Day, and when that didn’t
happen, he told Congress that he
wants to go forward with a U.S.-
Mexican trade pact to replace
NAFTA even if he can’t reach a
separate agreement with
Canada. On Sept. 1, he fired off
a volley of angry tweets. “There
is no political necessity to keep
Canada in the new NAFTA
deal,” he wrote. “If we don’t
make a fair deal for the U.S. af-
ter decades of abuse, Canada
will be out.”
Union leaders and many
members of Congress disagreed
with that.
“North America’s economies
are so integrated that it is hard to
see how this new deal could
work if our brothers and sisters
in Canada are not included,”
Trumka and the other union
leaders declared Aug. 31. “We
think it is a mistake to move
ahead on a bilateral basis, and
will continue to push to be sure
that Canada is included in any
final agreement.”
Canada and the United States
have had trade disputes over the
years, notably over Canadian
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