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The Perils of Free Trade
The Perils of Free Trade
The Change to Win coalition has taken an active stance against NAFTA, CAFTA, World Trade Organization negotiations and the Oman and Peru Free Trade Agreements—the lack of effective labor provisions in these trade agreements have catastrophic implications for both workers here at home and in Latin America.
The UFCW believes in a fair trading system that benefits both U.S. workers and workers across the globe. Unfortunately, the trade agreements that have been negotiated by the United States were not based on such principles; instead those agreements would benefit multinational corporations at the expense of workers.
NAFTA:
The North American Free Trade Agreement (NAFTA) has been an unqualified disaster for working people. In Canada, the United States and Mexico, wages in manufacturing have fallen behind productivity increases, shifting income from labor to capital.
Widespread job losses, stagnated worker incomes, increased insecurity, and rising inequality have accelerated in Canada, Mexico and the U.S. since NAFTA took effect in 1994, according to a report from the Economic Policy Institute (EPI). The report also cited that, "NAFTA eliminated 766,030 actual and potential U.S. jobs between 1994 and 2000 because of the rapid growth in the net U.S. export deficit with Mexico and Canada." While the job picture for US workers was grim, NAFTA's impact on Mexican jobs was even more devastating.
But the most serious consequence of NAFTA has been its failure to protect the rights of workers as promised by its supporters. To attract investment to the maquiladoras, Mexican government authorities cooperated with investors and compliant official unions in maintaining a low-wage economy, reinforced with a system of labor control. To enforce this system, maquiladora workers are required to belong to government-controlled unions that have no intention of raising those low wages or helping them end exhausting and dangerous working conditions. NAFTA's sponsors promised that the treaty's labor side agreement would protect workers, even though the treaty itself was intended to demolish all barriers to foreign investment. The side agreement proved toothless. Not one fired worker has been returned to his or her job, and not one independent union has gained legal status and a contract as a result of the NAFTA process.
CAFTA:
On December 17, 2005, officials from Guatemala, Honduras, El Salvador and Nicaragua finished negotiations with the United States on the Central American Free Trade Agreement (CAFTA). The American labor movement has teamed up with unions and grassroots groups in Central America to voice opposition to CAFTA. CAFTA is a bad deal, one that promises to extend the harmful impacts of NAFTA to Mexico's weaker southern neighbors. CAFTA will diminish pro-worker safeguards present in the Caribbean Basin Trade Partnership Act. While the previous initiative mandated that participating countries uphold internationally recognized labor norms, the new agreement only requires that governments enforce their own laws—which are often far weaker.
For these reasons, a ratified CAFTA would represent a clear blow to poor and working people in the Americas. U.S. workers will continue to lose good jobs as the global sweatshop expands. They say eliminating tariffs will mean more American exports, translating into more jobs for U.S. workers. What Bush and other CAFTA supporters fail to mention are the jobs destroyed as American companies relocate to Central America to take advantage of cheaper, largely unorganized labor.
