We must continue to remain vigilant against off-shoring of jobs
With the House of Representatives set to vote on the revised NAFTA (also known as USMCA) shortly, it is important to discuss what this agreement is and what it is not. It is not a “fix” for the many problems created by NAFTA and other misguided tax and labor policies that have flourished for decades in our nation’s capital and statehouses throughout the country. Hundreds of thousands of U.S. jobs that have gone to Mexico since NAFTA came into being 25 years ago will not return because of USMCA.
Autoworkers know this to be true from our experience, but experts have also stated so.
According to an analysis by the U.S. International Trade Commission, USMCA will create just 51,000 new jobs in manufacturing, mining and farming over the next six years. The International Monetary Fund (IMF) predicts actual loses in the auto sector.
The agreement before congress is significantly stronger from the original negotiated by the Trump administration because of the work of Speaker Nancy Pelosi, Senator Sherrod Brown, Senator Ron Wyden, Senator Debbie Stabenow and Senator Gary Peters and the USMCA working group. They fought to make this a much better agreement as the original had very weak enforcement mechanisms, inadequate labor standards, and give aways to the pharmaceutical industry
The new rapid response mechanism modeled off of the Brown-Wyden proposal, and revised labor chapter is better than what we have today, but it will take a strong commitment by Mexico’s government and our own to make them effective tools that makes a difference for working people. Corporations and company unions set on keeping the status quo in Mexico will try to create and exploit any and all loopholes to make it an ineffective tool. This and future administrations will be given a great deal of discretion in determining its effectiveness. If this or a future Administration decides that a rapid response labor panel is not necessary, the only requirement is that they notify the appropriate congressional committees on why they made their decision.
It will be difficult to ensure Mexico’s government fully implement its labor law reforms. And will take great, sustained political will and their strong financial commitments. The vast majority of union contracts in Mexico are “protection contracts” that put the interests of employers above employees is daunting. There are reportedly over half million existing collective bargaining agreements and vast majority are protection contracts.
Some supporters of USMCA highlight the higher auto rule of origin standards as good for U.S workers but do not note the higher standards could mostly be satisfied by shifting production from Eastern Europe and Asia to Mexico not to the United States.
They are also fond of saying it requires auto workers to have a minimum salary of $16 an hour. In fact, is an average and not a floor and companies’ intent on keeping business as usual will go through great lengths to keep wages down and jobs in Mexico. It is not comforting that so many companies that have moved production to Mexico and plan major investments have embraced the auto rule of origin standard.
We are concerned companies will try to comply by shifting some production in U.S. and Canada, not raising wages in Mexico.
We will do all we can to vigilantly monitor the agreement to try to make sure multinational corporations live up to their end of the bargain, but we should have no illusion that our efforts alone will get the job done. Putting an end to company unions, sham contracts, low wages, and weak environmental standards that have lured U.S. companies to send jobs south of the border for so long will be very difficult and will require the full commitment of our government and Mexico’s over many, many years.
As I said before, it will require a full court press by our elected leaders to wage a successful fight against the offshoring of jobs and the economic inequality that has harmed our country and working people for decades. Bad tax laws that reward companies for moving jobs abroad will need to repealed and our anemic labor laws must be updated and strengthened by passing the Protecting the Right to Organize (PRO Act), and other pro-worker measures, to ensure all workers have a right to have voice on the job. Collective bargaining backed up by the rule of law has long proven to be the surest way to improve wages and working conditions and will continue to be so as time goes on.
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