February, 13 2014, 02:49pm EDT
For Immediate Release
Contact:
Alisa Simmons (202) 454-5111
Lori Wallach (202) 454-5107 lwallach@citizen.org
Obama Mexico Visit Spotlights 20-Year Legacy of Job Loss from NAFTA, the Pact on Which Obama's Trans-Pacific Partnership Is Modeled
The 20-year record of job loss and trade deficits from the North American Free Trade Agreement (NAFTA) is haunting President Barack Obama's efforts to obtain special trade authority to fast track the Trans-Pacific Partnership (TPP), said Public Citizen as it released a new report that comprehensively documents NAFTA's outcomes.
WASHINGTON
The 20-year record of job loss and trade deficits from the North American Free Trade Agreement (NAFTA) is haunting President Barack Obama's efforts to obtain special trade authority to fast track the Trans-Pacific Partnership (TPP), said Public Citizen as it released a new report that comprehensively documents NAFTA's outcomes. Next week's presidential trip to Mexico for a long-scheduled "Three Amigos" U.S.-Mexico-Canada summit will raise public attention to NAFTA, on which the TPP is modeled, which is not good news for Obama's push for the TPP and Fast Track.
Numerous polls show that opposition to NAFTA is among few issues that unite Americans across partisan and regional divides. Public ire about NAFTA's legacy of job loss and policymakers' concerns about two decades of huge NAFTA trade deficits have plagued the administration's efforts to obtain Fast Track trade authority for the TPP. The TPP would expand the NAFTA model to more nations, including ultra-low-wage Vietnam. In the U.S. House of Representatives, most Democrats and a bloc of GOP have indicated opposition to Fast Track, as has Senate Majority Leader Harry Reid (D-Nev.).
Public Citizen's new report, "NAFTA's 20-Year Legacy and the Fate of the Trans-Pacific Partnership," compiles government data on NAFTA outcomes to detail the empirical record underlying the public and policymaker sentiment. It also shows that warnings issued by NAFTA boosters that a failure to pass NAFTA would result in foreign policy crises - rising Mexican migration and a neighboring nation devolving into a troubled narco-state - actually came to fruition in part because of NAFTA provisions that destroyed millions of rural Mexican livelihoods.
"Outside of corporate boardrooms and D.C. think tanks, Americans view NAFTA as a symbol of job loss and a cancer on the middle class," said Lori Wallach, director of Public Citizen's Global Trade Watch. "If you are a president battling to overcome bipartisan congressional skepticism about giving you special trade authority to fast track a massive 12-nation NAFTA expansion, it is really not helpful to be visiting Mexico for a summit of NAFTA-nation leaders."
The Public Citizen report shows that not only did projections and promises made by NAFTA proponents not materialize, but many results are exactly the opposite. Such outcomes include a staggering $177 billion U.S. trade deficit with NAFTA partners Mexico and Canada, one million net U.S. jobs lost in NAFTA's first decade alone, slower U.S. manufacturing and services export growth to Mexico and Canada, a doubling of immigration from Mexico, larger agricultural trade deficits with Mexico and Canada, and more than $360 million paid to corporations after "investor-state" tribunal attacks on, and rollbacks of, domestic public interest policies.
"The data have disproved the promises of more jobs and better wages, so bizarrely now NAFTA defenders argue the pact was a success because it expanded the volume of U.S. trade with the two countries without mentioning that this resulted in a 556 percent increase in our trade deficit with those countries, with a flood of new NAFTA imports wiping out hundreds of thousands of American jobs," said Wallach.
The study tracks specific promises made by U.S. corporations like Chrysler, GE and Caterpillar to create specific numbers of American jobs if NAFTA was approved, and reveals government data showing that instead, they fired U.S. workers and moved operations to Mexico.
"The White House and the corporate lobby sold NAFTA with promises of export growth and job creation, but the actual data show the projections were at best wrong," said Wallach. "The gulf between the gains promised for NAFTA and the damage that ensued means that the public and policymakers are not buying the same sales pitch now being made for the TPP and Fast Track."
The report also documents how post-NAFTA trade and investment trends have contributed to middle-class pay cuts, which in turn contributed to growing income inequality; how since NAFTA, U.S. trade deficit growth with Mexico and Canada has been 50 percent higher than with countries not party to a U.S. Free Trade Agreement, and how U.S. manufacturing and services exports to Canada and Mexico have grown at less than half the pre-NAFTA rate.
Among the study's findings:
Rather than creating in any year the 200,000 net jobs per year promised by former President Bill Clinton on the basis of Peterson Institute for International Economics projections, job loss from NAFTA began rapidly:
American manufacturing jobs were lost as U.S. firms used NAFTA's foreign investor privileges to relocate production to Mexico, and as a new flood of NAFTA imports swamped gains in exports, creating a massive new trade deficit that equated to an estimated net loss of one million U.S. jobs by 2004. A small pre-NAFTA U.S. trade surplus of $2.5 billion with Mexico turned into a huge new deficit and a pre-NAFTA $29.6 billion deficit with Canada exploded. The 2013 NAFTA deficit was $177 billion, representing a more than six-fold increase in the NAFTA deficit.
More than 845,000 specific U.S. workers, most in the manufacturing sector, have been certified for Trade Adjustment Assistance (TAA) since NAFTA because they lost their jobs due to offshoring to, or imports from, Canada and Mexico. The TAA program is narrow, covering only a subset of jobs lost at manufacturing facilities, and is difficult to qualify for. Thus, the TAA numbers significantly undercount NAFTA job loss. A TAA database searchable by congressional district, sector and more is available here.
NAFTA has contributed to downward pressure on U.S. wages and growing income inequality. There is broad consensus among economists that recent trade flows have been a significant contributor to growing income inequality; the only debate is about the degree of trade's responsibility. NAFTA's broadest economic impact has been to fundamentally transform the types of jobs and wages available for the 63 percent of American workers without a college degree. Most of those who lost manufacturing jobs to NAFTA offshoring and import competition found reemployment in lower-wage service sector jobs. According to the U.S. Bureau of Labor Statistics, two out of every three displaced manufacturing workers who were rehired in 2012 experienced a wage reduction, most of them taking a pay cut of greater than 20 percent. As increasing numbers of workers displaced from manufacturing jobs have joined those competing for non-offshorable, low-skill jobs in sectors such as hospitality and food service, real wages have also fallen in these sectors under NAFTA. The resulting downward pressure on middle-class wages has fueled recent growth in income inequality.
Scores of environmental and health laws have been challenged in foreign tribunals through NAFTA's controversial investor-state dispute resolution system. More than $360 million in compensation to investors has been extracted from NAFTA governments via "investor-state" tribunal challenges against toxics bans, land-use rules, water and forestry policies, and more. More than $12.4 billion is pending in such NAFTA claims, including challenges of medicine patent policies, a fracking moratorium and a renewable energy program.
The average annual U.S. agricultural trade deficit with Mexico and Canada in NAFTA's first two decades reached $975 million, almost three times the pre-NAFTA level. U.S. beef imports from Mexico and Canada, for example, have risen 133 percent. Over the past decade, total U.S. food exports to Mexico and Canada have actually fallen slightly while U.S. food imports from Mexico and Canada have more than doubled. This stands in stark contrast to projections that NAFTA would allow U.S. farmers to export their way to newfound wealth and farm income stability. Despite a 239 percent rise in food imports from Canada and Mexico under NAFTA, the average nominal U.S. price of food in the United States has jumped 67 percent since NAFTA.
The reductions in consumer goods prices that have materialized have not been sufficient to offset the losses to wages under NAFTA; U.S. workers without college degrees (63 percent of the workforce) likely have lost a net amount equal to 12.2 percent of their wages even after accounting for gains from cheaper goods. This net loss means a loss of more than $3,300 per year for a worker earning the median annual wage of $27,500.
The export of subsidized U.S. corn did increase under NAFTA's first decade, destroying the livelihoods of more than one million Mexican campesino farmers and about 1.4 million additional Mexican workers whose livelihoods depended on agriculture.The desperate migration of those displaced from Mexico's rural economy pushed down wages in Mexico's border maquiladora factory zone and contributed to a doubling of Mexican immigration to the United States following NAFTA's implementation.
Facing displacement, rising prices and stagnant wages, more than half the Mexican population, and more than 60 percent of the rural population, still falls below the poverty line, despite the promises that NAFTA would bring broad prosperity to Mexicans. Real wages in Mexico have fallen significantly below pre-NAFTA levels as price increases for basic consumer goods have exceeded wage increases. A minimum wage earner in Mexico today can buy 38 percent fewer consumer goods than on the day that NAFTA took effect. Despite promises that NAFTA would benefit Mexican consumers by granting access to cheaper imported products, the cost of basic consumer goods in Mexico has risen to seven times the pre-NAFTA level, while the minimum wage stands at only four times the pre-NAFTA level. Though the price paid to Mexican farmers for corn plummeted after NAFTA, the deregulated retail price of tortillas - Mexico's staple food - shot up 279 percent in the pact's first 10 years.
"Given NAFTA's damaging outcomes, few of the corporations or think tanks that sold it as a boon for all of us in the 1990s like to talk about it, but the reality is that their promises failed, the opposite occurred and millions of people were severely harmed and now this legacy is derailing President Obama's misguided push to expand NAFTA through the TPP," said Wallach.
The report is available at https://www.citizen.org/documents/NAFTAs-20-year-legacy.pdf.
Public Citizen is a nonprofit consumer advocacy organization that champions the public interest in the halls of power. We defend democracy, resist corporate power and work to ensure that government works for the people - not for big corporations. Founded in 1971, we now have 500,000 members and supporters throughout the country.
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Indigenous Brazilians Mobilize for Land Demarcation, Tribal Rights
Participants in the 20th Free Land Camp demanded that leftist Brazilian President Luiz Inácio Lula da Silva deliver on his promises to Indigenous people.
Apr 26, 2024
Thousands of people rallied this week in Brasília for the 20th annual Free Land Camp—the largest gathering of Indigenous people in Brazil—where participants demanded that President Luiz Inácio Lula da Silva's administration safeguard their lands and cultural rights
Organized by the Association of Brazil's Indigenous Peoples (APIB), the five-day Free Land Camp—in Portuguese, Acampamento Terra Livre (ATL)—wrapped up Friday after a week of solidarity and action. Activities included rallies and marches; events commemorating slain Indigenous activists; and plenary sessions on the climate emergency, education, mental health, and more.
Some participants criticized Lula—who was notably absent from this year's ATL after attending the previous two camps—for what they said was his failure to fulfill campaign promises to Indigenous Brazilians—although attendees also acknowledged that his administration has taken major steps toward tackling illegal resource extraction and demarcating tribal lands.
Two big issues at this year's ATL—whose theme was "Our Existence is Ancestral: We Have Always Been Here!"—were the demarcation of Indigenous lands and opposition to proposed Amazon megaprojects, especially the plan to build the EF-170 railway through the heart of the imperiled rainforest in order to boost mining, logging, agribusiness, and other resource extraction and exploitation.
Last year, Brazilian lawmakers overruled Lula's partial veto of the highly contentious "Marco Temporal" law, which effectively paused demarcations and potentially opened more Indigenous lands to exploitation.
Demarcation confers legal protections against the illegal logging, mining, and ranching that have plagued rural Brazil for generations. On April 19—Indigenous Peoples Day in Brazil—Lula touted his government's demarcation of Aldeia Velha, land of the Pataxó people, in the northeastern state of Bahia, as well as the territory of the Karajá people in Cacique Fontoura, Mato Grosso.
Lula has acknowledged that his administration is falling short of its own demarcation pledges to Indigenous people and has promised to do more.
Alessandra Korap Munduruku, a member of the Munduruku people and a 2023 winner of the prestigious Goldman Environmental Prize, criticized the demarcation delay.
"Twenty years of resistance struggle by the Terra Livre camp. For 20 years we've been coming to Brasília, occupying and seeking our rights," she said. "This year, we're waiting for the government to demarcate all our lands. But the government is letting the [state] governors decide for us."
"This is not what we expect. It's not the governor's decision to make. It's the federal government's," Korap Munduruku added. "This is written in the Constitution, and we see that we are being used."
Brazilian and international agribusiness interests, including commodity traders like U.S.-based Cargill, are pushing Lula's administration to proceed with EF-170—commonly called the Ferrogrão—over the objections of Indigenous peoples. Kayapó leader Doto Takak-Ire warned last year that the Ferrogrão threatens the survival of no less than 48 native peoples, calling the project "the railway of Indigenous genocide."
Earlier this year, Brazilian Transport Minister Renan Filho said that building the Ferrogrão is a top administration priority, sparking widespread disappointment and anger among the Kayapó and other Indigenous people who say they'll be adversely affected by the railway.
ATL participants on Thursday led a "train of death" through Brasília's Esplanade of Ministries, a greenway bisecting numerous government buildings, to draw attention to the project's perils.
"Ferrogrão is the train of death, of deforestation," Korap Munduruku said Thursday.
"The railroad is not going to carry people, as they claim, but grain production of international companies that are financing this project," she continued. "It's a project that will affect not only Indigenous people, but also traditional communities and the people who live in the towns alongside its route."
"In addition, it is a project that will affect people all over the world because it would exacerbate climate change with the massive deforestation it would cause," Korap Munduruku added.
APIB executive coordinator Kleber Karipuna said the government did not adequately consult Indigenous peoples when planning the Ferrogrão.
"Hearings have only been held in cities, none in Indigenous villages," the Karipuna tribal leader said. "Once again, we demand that the protocols for consulting Indigenous peoples be respected. Additionally, the absence of a consultation protocol should not be used as an excuse to deny consultation of peoples affected by the project."
Takakpe Tapayuna Metuktire of the Raoni Institute, which promotes Indigenous rights and sustainability, warned that "Ferrogrão represents the death of kilometers and kilometers of forest."
"While we should be thinking about how to preserve what remains and think about alternative infrastructure projects that respect our rights, nature, and Indigenous and traditional peoples," Tapayuna Metuktire asserted. "We are fighting to prevent yet another project of death and destruction from prevailing in the Amazon. With Ferrogrão all that will be left is scorched earth."
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UN Warns of 'Catastrophic' Imminent Escalation in Sudan
Warring factions in North Darfur state must "avoid locating military installations within or near densely populated areas, including towns and camps for internally displaced people," said one U.N. official.
Apr 26, 2024
The United Nations' top humanitarian affairs officials on Friday called for an immediate deescalation of hostilities in Sudan, where rival factions in the military government have been fighting for a year and where an attack on the city of El Fasher is reportedly imminent.
About 800,000 people in the city, the capital of North Darfur state, are in "extreme and immediate danger," U.N. aid operations director, Edem Wosornu, told the U.N. Security Council earlier this week, as she reported that clashes between the Rapid Support Forces (RSF), a paramilitary group, and the Sudanese Armed Forces (SAF) are nearing El Fasher.
Fighting between the two groups has intensified in recent weeks, forcibly displacing an estimated 40,000 people.
The U.N. Office for the Coordination of Humanitarian Affairs said Friday that the security situation in North Darfur has left more than a dozen aid trucks with relief supplies for 122,000 people stranded in neighboring Northern state, unable to proceed into the only capital city in Darfur that is not controlled by RSF.
"A patchwork of armed actors, including the Darfur Joint Protection Forces, the SAF, and the RSF control different parts of the El Fasher area," Human Rights Watch reported this week. "Tense calm alternating with episodic fighting has prevailed for months."
Since April 14, when RSF began to push into El Fasher, at least 43 people—including women and children—have been killed due to fighting between the SAF and RSF.
"Civilians are trapped in the city, afraid of being killed should they attempt to flee," said Seif Magango, spokesperson for the U.N. high commissioner for human rights, Volker Türk. "This dire situation is compounded by a severe shortage of essential supplies as deliveries of commercial goods and humanitarian aid have been heavily constrained by the fighting, and delivery trucks are unable to freely transit through RSF-controlled territory."
The lack of humanitarian aid in North Darfur has pushed the state toward a famine, with one child dying of starvation every two hours, according to a February report by Doctors Without Borders.
In December, the U.S. State Department announced an $85 million sale of radar and other military equipment to the United Arab Emirates (UAE), which The New York Times reported last year has been covertly supporting the RSF.
U.S. Rep. Ilhan Omar (D-Minn.) proposed a joint resolution to block arms sales to the UAE in January, in light of its support for the paramilitary group.
Omar was among several lawmakers who wrote to President Joe Biden and Secretary of State Antony Blinken earlier this week, urging them to "deliver urgently-needed humanitarian assistance" and to help end the hostilities.
Sudanese-Australian writer Yassmin Abdel-Magied urged Americans on Friday to pressure lawmakers and the White House to take more action.
"There is a tiny window of opportunity for us to find a way to get the UAE... to make the RSF to stop in their tracks," said Abdel-Magied. "Maybe there's a way that we can avoid this massacre."
OCHA called on the warring parties to "take constant care to spare civilians and civilian objects in the conduct of military operations."
"They must, to the extent possible, avoid locating military installations within or near densely populated areas, including towns and camps for internally displaced people," said the office. "It is also imperative that the parties allow safe passage for civilians to leave El Fasher for safer areas."
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With US Workers on the March, Southern States Take Aim at Unions
GOP leaders in the region are "truly astonished that workers might not trust their corporate overlords with their working conditions, pay, health, and retirement," said one critic.
Apr 26, 2024
Since six Southern Republican governors last week showed "how scared they are" of the United Auto Workers' U.S. organizing drive, Tennessee Volkswagen employees have voted to join the UAW while GOP policymakers across the region have ramped up attacks on unions.
The UAW launched "the largest organizing drive in modern American history" after securing improved contracts last year with a strike targeting the Big Three automakers—General Motors, Ford, and Stellantis. The ongoing campaign led to the "landslide" victory in Chattanooga last week, which union president Shawn Fain pointed to as proof that "you can't win in the South" isn't true.
The Tennessee win "is breaking the brains of Republicans in that region. They're truly astonished that workers might not trust their corporate overlords with their working conditions, pay, health, and retirement," Thom Hartmann wrote in a Friday opinion piece.
"The problem for Republicans is that unions represent a form of democracy in the workplace, and the GOP hates democracy as a matter of principle."
"The problem for Republicans is that unions represent a form of democracy in the workplace, and the GOP hates democracy as a matter of principle," he argued. "Republicans appear committed to politically dying on a number of hills that time has passed by. Their commitment to gutting voting rolls and restricting voting rights, their obsession with women’s reproductive abilities, and their hatred of regulations and democracy in the workplace are increasingly seen by average American voters as out-of-touch and out-of-date."
Just before voting began in Chattanooga, GOP Govs. Kay Ivey of Alabama, Brian Kemp of Georgia, Tate Reeves of Mississippi, Henry McMaster of South Carolina, Bill Lee of Tennessee, and Greg Abbott of Texas claimed that "unionization would certainly put our states' jobs in jeopardy" and the UAW is "making big promises to our constituents that they can't deliver on."
The next nationally watched UAW vote is scheduled for May 13-17 at a Mercedes-Benz plant in Vance, Alabama.
"Workers at our plant are ready for this moment," Mercedes employee Jeremy Kimbrell said last week. "We are ready to vote yes because we are ready to win our fair share. We are going to end the Alabama discount and replace it with what our state actually needs. Workers sticking together and sticking by our community."
As workers gear up for the election, the Alabama House of Representatives on Tuesday voted 72-30 for a bill that would withhold future economic incentive money from companies that voluntarily recognize unions rather than holding secret ballots. The state Senate previously passed a version of the legislation but now must consider it with the lower chamber's amendments.
The Associated Pressnoted that "Georgia Gov. Brian Kemp signed similar legislation on Monday" and that Tennessee already has one on the books.
With his signature on Senate Bill 362, "Kemp's aim is to thwart future organizing attempts by workers at automotive plants in Georgia, such as those operated by Hyundai Motor Group," according toThe Atlanta Journal-Constitution.
As the newspaper detailed:
Georgia has been a right-to-work state since 1947, when Congress passed the Taft-Hartley Act, allowing workers to refuse to join a union or pay dues, even though they may benefit from contracts negotiated by a union with their employer. Just 5.4% of workers in the state belonged to a union in 2023, according to the U.S. Bureau of Labor Statistics.
But the National Labor Relations Act of 1935, also known as the Wagner Act, protects the right for workers to form a union and collectively bargain for better wages and working conditions.
The new Georgia law is expected to be challenged in court, labor experts have said.
Acting U.S. Labor Secretary Julie Su told the AP on Thursday that she is not sure if the department will challenge the laws, given the National Labor Relations Board's responsibilities, but she stressed that "there are federal standards beneath which no worker should have to live and work."
In terms of joining a union, "that choice belongs to the worker, free from intervention, either by the employer or by politicians, free from retaliation and threats," Su said. "And what we are seeing is that workers who were thought to be too vulnerable to assert that right are doing it, and they're doing it here in the South."
The U.S. labor chief also slammed "unacceptable" union-busting efforts by companies and suggested that protecting the right to unionize is part of President Joe Biden's "promise to center workers in the economy."
"He has said he's the most pro-worker, pro-union president in history, and we are going to make good on that promise. And that includes making sure that workers have the right to join a union," Su said of the president.
Biden's commitment to workers and unionizing rights has caught the attention of GOP leaders. The governors' joint statement nodded to the UAW's January endorsement of the president, who is seeking reelection in November, and South Carolina's leader attacked the administration earlier this year.
During his January State of the State speech, McMaster declared that "we will not let our state's economy suffer or become collateral damage as labor unions seek to consume new jobs and conscript new dues-paying members. And we will not allow the Biden administration's pro-union policies to chip away at South Carolina's sovereign interests. We will fight. All the way to the gates of hell. And we will win."
News From the Statesreported Friday that "of all the foreign-owned automakers in South Carolina, BMW would be the most likely mark in the near term if enough of its workers show interest. The massive plant near Greer—the manufacturer's only U.S. production facility—employs some 11,000 people, twice the number of workers at Volkswagen in Tennessee and Mercedes in Alabama. It has operated in the Upstate for nearly 30 years and is in the process of adding electric vehicle lines."
However, a UAW spokesperson told the outlet that they don't yet have the numbers for the BMW and Volvo facilities in the state, and Marick Masters, a Wayne State University professor who studies the union, said: "I don't think they're writing anybody off but they know the history of unionization. And I would say South Carolina is a very inhospitable place for unions."
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