Thursday the AFL-CIO released a new report, NAFTA at 20. The report makes the point that, “On the whole, NAFTA-style agreements have proved to be primarily a vehicle to increase corporate profits at the expense of workers, consumers, farmers, communities, the environment and even democracy itself.”
In a press release accompanying the report AFL-CIO President Richard Trumka says that working people and democratic governance on all sides of NAFTA’s borders are now worse off, and Congress should recognize this before approving any more “NAFTA-style” trade agreements.
“There is no success story for workers to be found in North America 20 years after NAFTA,” said Trumka. “The NAFTA model focuses on lifting corporations out of reach of democratic governance, rather than solely reducing tariffs. This report should serve as a cautionary tale to the Obama Administration and Congress as they consider negotiating and implementing new trade deals.”
Trade Agreements Should Stop Following The NAFTA Model
Preceding the report, Trumka gave a major speech on trade at the Center for American Progress. He talked about the history of “a disastrous, outdated, failed model of global economic policies.” He said that trade agreements should abandon the NAFTA model and instead offer a “global new deal … to bring the basic infrastructure of modern society—electricity, water, schools, roads, internet access—to everyone on Earth.”
A summary of the report contains these points about NAFTA:
– It’s a flawed model that promotes the economic interests of a very few and at the expense of workers, consumers, farmers, communities, the environment and even democracy itself.
– While the overall volume of trade within North America due to NAFTA has increased and corporate profits have skyrocketed, wages have remained stagnant in all three countries.
– Productivity has increased, but workers’ share of these gains has decreased steadily, along with unionization rates.
– NAFTA pushed small Mexican farmers off their lands, increasing the flow of desperate undocumented migrants.
– It exacerbated inequality in all three countries.
– And the NAFTA labor side agreement has failed to accomplish its most basic mandate: to ensure compliance with fundamental labor rights and enforcement of national labor laws.
The NAFTA architecture of deregulation coupled with investor protections allowed companies to move labor intensive components of their operations to locations with weak laws and lax enforcement. This incentivized local, state and federal authorities to artificially maintain low labor costs by ignoring–or in some cases actively interfering with–such fundamental rights as the rights to organize, strike and be free from discrimination. This dynamic undermined organizing and bargaining efforts even in areas with relatively robust labor laws. Today, it is commonplace for employers to threaten to move south—whether to South Carolina or Tijuana—if workers do not agree to cuts in wages and benefits.
See the report at NAFTA at 20.
In his speech Trumka began by outlining how NAFTA failed regular people by killing jobs and keeping wages down, which enriching an already-wealthy few – setting the stage for the 2008 financial collapse.
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