Increasing so-called “free” trade across the globe has been a rallying cry for U.S. leaders for more than two decades. Supporters have insisted such deals would lead to more jobs and a better economy. But it has been nothing but a boondoggle at the expense of the American worker.
The constant drip-drip-drip of job loss that began 21 years ago with the enactment of NAFTA has led to a flood of lost jobs since then. The U.S.-Mexico-Canada trade pact resulted in 1 million lost jobs, but even that pales in comparison to the approval of permanent normalization of trade relations with China. The decision to allow the world’s most populated communist nation into the World Trade Organization in 2001 has cost 3.2 million American jobs according to the most recent numbers. About three quarters of those have been in manufacturing. Every congressional district except one has been negatively impacted by that decision.
That is why the Teamsters and other fair trade advocates are wary of pending trade deals like the Trans-Pacific Partnership (TTP) and Transatlantic Trade and Investment Partnership (TTIP). And it is why the union is working hard to ensure Capitol Hill doesn’t blindly implement them.
“Workers know all too well what happens when unfair trade deals are allowed to sail through Congress,” said Teamsters General President Jim Hoffa. “We can’t allow more agreements that give short shrift to hardworking Americans while hollowing out communities. If we want to ensure a healthy middle class, lawmakers can’t just quickly approve these secretive deals.”
The time for Congress to act is now. The first step is to defeat fast-track trade promotion authority, which would allow agreements like TPP and TTIP to glide through Capitol Hill without being amended. Lawmakers would essentially be rubber-stamping whatever deal is put before them. They would be abdicating their responsibility under the U.S. Constitution to review trade agreements before this country enters into them.
The Senate Finance Committee has been busy reviewing old-model fast-track legislation that would hurt Americans because it doesn’t look out for workers. The Teamsters and their fair trade allies realize changes must be made to that model so it prevents thousands of jobs from being shipped overseas. Otherwise, it must be completely stopped.
Some lawmakers get it. In a letter sent to U.S. Trade Representative Michael Froman late last year, Sens. Elizabeth Warren (D-Mass.), Tammy Baldwin (D-Wis.) and Edward Markey (D-Mass.) wrote that fast track in its current form is a loser for hardworking Americans.
“We cannot afford a trade deal that undermines the government’s ability to protect the American economy,” they said.
“Enough is Enough”
A battle is also raging in the House, where leading voices like Rosa DeLauro (D-Conn.), Tim Ryan (D-Ohio), Mark Pocan (D-Wis.), Louise Slaughter (D-N.Y.), Keith Ellison (D-Minn.) and others have repeatedly spoken out about the dangers of the current incarnation of fast track.
They noted that given how little the public knows about the trade agreements currently being negotiated, it is madness to move ahead with fast track.
“Enough is enough: no more offshoring, no more NAFTA-style trade deals,” DeLauro stated.
Democrats, however, are not the only ones raising concerns about fast track and trade. In fact, 19 House Republicans wrote House Speaker John Boehner (R-Ohio) in December asking him to slow down consideration of the provision, which proponents had hoped to push through at the end of 2014. And Tea Party leaders have been some of the most outspoken critics of the move to give the executive branch unfettered control over the trade process. They note it would suspend the “regular order” of Congress in order to give the White House “extra-constitutional power.”
Most importantly, however, is that working people are against it as well. A 2014 poll conducted by Hart Research Associates and Chesapeake Beach Consulting found that by more than two-to-one, voters said they do not favor tampering with legislative procedure to push through a deal that will only help big business and the one percent. That’s not going to help any lawmaker looking to stay in office.
That’s why the Teamsters and their fair trade allies have spent the early part of 2015 contacting members of Congress and demonstrating outside of district offices across the country letting them know about the big lie that is fast track And it’s why union members need to keep up that drumbeat by contacting their elected officials and doing the same.
The issues with trade, however, go much deeper than fast track. For example, TPP—the largely secret 12-nation Pacific Rim trade deal that negotiators are desperately trying to complete after years of talks—is chock full of problems that will hurt workers not only in the U.S. but abroad. Pay and working conditions will deteriorate while the public will be exposed to more unsafe products and food.
“The TPP is not just another free trade agreement,” Sen. Bernie Sanders (I-Vt.) wrote in a letter sent to U.S. Trade Representative Froman earlier this year. “It has broad economic and political implications for the entire economy, national sovereignty, health care, the environment, national security, and the federal budget, among other things.”
Deficits In the wake of NAFTA’s enactment, the U.S. has shipped jobs overseas while running up increasingly large trade deficits—not only with Mexico and Canada, but other nations like China.
A report by the Economic Policy Institute (EPI) shows that between 1993 and 2010, America’s trade deficit with Mexico grew from $1.6 billion to $97.2 billion. And a Public Citizen report released last year placed the combined U.S. trade deficit with both Mexico and Canada at $181 billion.
Meanwhile, the trade deficit between the U.S. and China reached an all-time high last September at $35.6 billion for the month.
The U.S. also saw how NAFTA could affect industry as well. The agreement led to repeated litigation and eventually the creation of a three-year Mexican trucking pilot program in the U.S. that drew little actual interest from trucking companies located south of the border (see story on Mexican trucking on page 18).
Certain industries could be hit particularly hard if the TPP moves forward.
The Teamsters, who represent 30,000 dairy workers in the U.S. and 10,000 in Canada, are concerned about possible changes made to the North American dairy market. Opening it up to more foreign competition would cause companies here to lose market share due to nations like New Zealand having a largely nationalized dairy sector. That’s unfair to dairy workers on this continent.
“New market access for New Zealand’s monopolistic dairy sector would be especially damaging to U.S. dairy farmers and those who produce and process nonfat dry milk, butterfat or cheese,” a letter from 12 dairy organizations sent to Congress states.
But there are broader concerns to consider. The investor-state dispute settlement (ISDS) process, for instance, would allow foreign corporations to circumvent American courts and challenge American policies before a panel of private attorneys that sits outside our legal system. U.S. taxpayers could be forced to pick up the bill if a company prevails.
In a letter signed by Sens. Warren, Baldwin and Markey last December, the three lawmakers said such language could jeopardize this country’s financial regulations and make the U.S. more susceptible to financial crises.
“We believe that the TPP should not include an investor state dispute settlement process,” they wrote. “Including such provisions in the TPP could expose American taxpayers to billions of dollars in losses and dissuade the government from establishing or enforcing financial rules that impact foreign banks. The consequence would be to strip our regulators of the tools they need to prevent the next crisis.”
ISDS is also a major concern with regards to TTIP as well. There, the European Commission is claiming that any threats the language poses can be fixed by improving such provisions.
But as Global Trade Watch found, that is unlikely to happen.
“Tribunals have a structural incentive to boost their caseload and increase their earnings by using broad interpretations of foreign investors’ rights to rule in favor of corporations, which decide if and when to initiate future cases, and against governments,” the group wrote.
Some countries are seeing the writing on the wall.
In TPP negotiations, representatives from Chile to Malaysia have raised concerns about the agreement and asked that the process be opened up so the public can have a greater say. They’ve questioned whether the trade deal will actually be good for workers or just for the corporations pushing for the pact’s implementation.
But others have proven they’re not interested in doing what needs to be done to make trade agreements fair. Japan, for example, has for years manipulated its currency so that its exports like automobiles are cheap in the U.S., but imports are too expensive and undesirable for its own people. The result is sky-high trade deficits for America and economic growth overseas while jobs and wages get cut at home.
And the undemocratic Vietnamese government sees the agreement as an opportunity to further validate the nation as it tries to emerge on the world stage. Inclusion in TPP would be seen as a badge of honor there in a nation that still engages in child and forced labor practices and has a minimum wage of less than $3 a day in parts of the country.
There is also a question of secrecy. The lack of information is a big hurdle that the Teamsters and other allies want addressed when it comes to trade deals.
These deals should be opened to all to view and consider. The lack of transparency is part of the reason why allowing such agreements to be fast tracked is so devastating to the public.
When it comes to the TPP, it seems unlikely that anything will change. But that is not the case with TTIP. The EU, after an outcry on both sides of the Atlantic, announced in early January that it will publish the legal texts for the pact. While that doesn’t change the quality of what is included, it’s a start. At least those pushing for fair trade know what they are up against.
The Teamsters realize what is at stake with trade. That’s why the union has been an active participant in helping to shape policy as part of the process while at the same time pushing back against language that would hurt hardworking Americans. Those efforts are magnified by getting the union’s 1.4 million members educated and involved in the fight both at home and in Washington.
The risks are significant. Supporters of trade deals like TPP and TTIP say they favor “free” trade. Yet, they want to push through a process like fast track which inherently makes congressional consideration of such deals less democratic.
If these agreements are so good for America, they should be able to stand on their own. But they can’t. Here’s why: They’re not fair to workers. They let big corporations ship jobs overseas and dump wages and benefits overboard along the way. They lead to lost jobs, shuttered plants and hollowed-out communities. And in return the vast majority of Americans only gets unsafe goods and foods that make their families sick.
It’s time the productivity of American workers showed up in their paychecks, and that means no more unfair trade deals.
How Trade Deals Such As TPP Threaten U.S. Jobs
In Conversation With Rome Aloise, Director of the Teamsters Dairy Conference and International Vice President.
How many dairy farmers and dairy manufacturers are represented by the Teamsters?
A: The Teamsters represent more than 30,000 workers at approximately 100 employers in the dairy industry across the country at approximately one-quarter of all Teamster locals.
Are foreign trade deals a threat to jobs?
A: Foreign trade deals are a threat to jobs, as they affect what (dairy) products are made, where and by whom. Every aspect of a global trade deal affects U.S. workers in some way. With regard to dairy, we are particularly concerned with market access issues, that is, what products manufactured in the United States will be able to be sold overseas vs. what imports from other countries will be able to be imported? If there is not an appropriate balance, it could cost U.S. workers’ jobs.
We also are very concerned with labor standards including safety and wages that are called for in trade deals, and the degree to which these deals provide flexibility for companies to move jobs overseas at the expense of U.S. workers.
Does it matter where dairy products are produced?
A: At a time when there is a lot of talk about growing or sourcing food locally and regionally, it should matter to everyone how and where dairy products are produced. We are equally concerned about the health and safety standards involved in production; particularly if we are talking about importing perishable products from other countries, or products with short shelf lives.
What can the average person do to prevent the TPP from passing?
A: The average person can do a number of things to prevent the Trans-Pacific Partnership (TPP), the current trade scheme, from passing. Since NAFTA, many trade deals and negotiations have taken place largely removed from public view. The best thing you can do is take time to educate yourself, and also to spread the word about the magnitude of these agreements, and how they have the potential to affect every aspect of American economic life in the coming decade.
The next best thing, as always, is to engage with your local and federal elected officials, particularly by contacting your Senators and Representatives and asking them, if they do not already do so, to oppose fast track or “TPA” legislation, which is the mechanism that would cram this bad deal through Congress.
Congress must make sure this trade deal doesn’t open the door to unfair competition. The dairy industry is too important to our economy and our food supply.
Bipartisan Agreement May Not Be Enough
The “Buy American” federal procurement program has been a smashing success for American businesses and workers. That’s why more than 130 House Democrats and Republicans are pushing to make sure it isn’t traded away as part of the 12-nation Trans-Pacific Partnership (TPP).
Lawmakers signed onto two different letters recently that called on the Obama administration to protect the more than 80-year-old program from being phased out as a condition included in the Pacific Rim trade agreement.
Such a move would hurt the U.S. economy and employment while funneling American tax dollars into the pockets of other nations.
“We must buy America to build America, and government procurement policy is no exception,” said Rep. Donna Edwards (D-Md.) a leader behind one of the letters. “Since 1933, buy American policies have helped create jobs, grown our economy and strengthen domestic manufacturing.”
That letter, signed by 121 mostly Democratic House members, points out that buy American rules have helped create strong middle-class jobs in the U.S. It also notes that the TPP would gut the program, resulting in “large sums of U.S. tax dollars being offshored and invested to strengthen many other countries’ manufacturing sectors, rather than our own.”
A separate letter signed by 14 House GOP lawmakers took a similar tone. It said scrapping buy American requirements that give preferential treatment to American companies is a non-starter. “We fear the proposed TPP terms will result in U.S. tax dollars being offshored and invested to strengthen other countries’ manufacturing sectors, rather than these tax dollars being spent at home to improve our own economy,” it stated.
If buy American is ended, American companies would be the big losers. The U.S. federal procurement market is more than 10 times larger than all the other prospective procurement markets combined. So in essence, the U.S. would be trading preferential access to the $556 billion American federal government procurement market in exchange for just $53 billion worth of new national procurement markets overseas.
Also, does it make sense to potentially turn over the U.S. military manufacturing keys to Chinese-owned Vietnamese companies that would be privy to state secrets? As Teamsters General President Jim Hoffa recently wrote in The Detroit News: “Hell no!”
It is rare indeed for any issue in Washington to receive support from both sides of the aisle. But here you have it. No matter what the politics might be, axing buy American is a big mistake.