Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘International trade’

Trade Is Trump’s Biggest Broken Promise

Monday, April 3rd, 2017

Say anything – literally anything – to sway working-class voters. Get elected, then loot the country. Hey, it worked for this guy.

If there was a singular issue Trump campaigned on, it was trade. Everywhere he went, Trump swore the North American Free Trade Agreement (NAFTA) was “the worst trade deal maybe ever signed anywhere” and “a rape of our country” – and whatever else he needed to say to sway working-class voters who felt betrayed by our economy and our trade deals.

Like other candidates before him, Trump wanted to win votes in places like Ohio, Pennsylvania, Michigan, Wisconsin and other states devastated by the loss of manufacturing jobs to “trade.”

In his speeches he complained that candidate Hillary Clinton had aligned herself with a”financial elite” to “betray” working people.

“Globalization has made the financial elite who donate to politicians very wealthy. But it has left millions of our workers with nothing but poverty and heartache.

[. . .] Hillary Clinton and her friends in global finance want to scare America into thinking small – and they want to scare the American people out of voting for a better future.

My campaign has the opposite message.

Later, he outlined specific complaints about the content of trade agreements, referring to Trans-Pacific Partnership (TPP) signed by President Obama, but clearly he meant multilateral trade deals in general. He said these trade deals had left decision-making to “an international commission” and that they do nothing about “currency cheaters.”

The “international commission” he refers to is a provision in trade agreements knowns as Investor-State Dispute Settlement (ISDS), more commonly known as “Corporate Courts.”

It would give up all of our economic leverage to an international commission that would put the interests of foreign countries above our own.

It would further open our markets to aggressive currency cheaters.

Specifically about ISDS provisions,

The TPP creates a new international commission that makes decisions the American people can’t veto.

These commissions are great Hillary Clinton’s Wall Street funders who can spend vast amounts of money to influence the outcomes.

Of course, that was then.

Never Mind

Trump, who campaigned promising to “drain the swamp” in Washington, has filled his administration with the very swamp creatures his voters hated. Billionaires, Goldman Sachs executives, lobbyists, and so on.

Now the very “financial elite” he railed about during the campaign appears to be having its way with him on trade. If the details in a draft letter circulated to members of Congress this week are true, Trump is not scrapping NAFTA after all.

In fact, he’s not even addressing what he had said were his biggest concerns in the trade agreement. A NY Times report explains,

Rather than scrap NAFTA’s arbitration tribunals, regarded by some free-trade critics as secretive bodies that give private corporations unbridled power to challenge foreign governments outside the court system, the letter proposed to “maintain and seek to improve procedures” for settling disputes.

It made no mention of currency policy, an issue many trade experts had thought might be on the table.

Trump wants minor tweaks to the agreement. ISDS still there. Nothing about currency. Too bad. Sad!

“The Same Corporate Wish List”

There were a number of reactions to Trump’s NAFTA reversal.

“Mostly what I see here is the same corporate wish list and a set of international rules that work quite well for global corporations,”  said the AFL-CIO’s trade policy specialist, Celeste Drake, to Politico.

AFL-CIO President Richard Trumka weighed in as well:

This draft leaves standing the worst and most oppressive parts of NAFTA. It leaves in place the right of foreign investors to sue the U.S. in private tribunals in order to skirt health, safety and environmental laws. On other important issues, including rules of origin for automobiles, labor and environmental standards, currency misalignment and procurement, the draft plan is either silent or so vague that it could be describing the now defunct Trans-Pacific Partnership – an agreement working people wholeheartedly opposed.

Rewriting the rules of our economy, and specifically changing the way we do trade, was one of the most important issues that voters went to the polls on. If the president wants to keep his promises, he needs to bring that same tough stance he had on the campaign trail to renegotiating America’s trade deals.

Politico’s Morning Trade carried reactions from Democrats in Congress:

Rep. Bill Pascrell, the ranking member of the House Ways and Means Trade Subcommittee, called it “baffling” that the draft left out currency manipulation, which Trump had made a signature campaign issue – “let alone call for strong and enforceable commitments.” “And I do not get the sense that the administration yet understands the importance of ensuring full implementation of international labor standards in Mexico to ensure the competitiveness of U.S. workers in the North American market,” the New Jersey lawmaker added in a statement.

So there it is. The guy who set up Trump University has now set up the Trump administration. It is staffed by family members, Breitbart editors, kooks, and, of course, the upper crust of the very “financial elite” he supposedly ran against.

After scarcely two months in office, the new administration is under investigation for violations ranging from breaking ethics rules to corruption and espionage. Trump has spent roughly a third of his time as president vacationing at his Mar-a-Lago golf resort in Florida and other Trump properties, with the government paying a huge tab – to him – for Secret Service, staffers and others who are along for the ride.

He said what he had to say to win. Now we’re stuck.

This post originally appeared on ourfuture.org on March 31, 2017. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.

 

WTO Finds China Broke Trade Laws, But Steelworkers President Says Action Not Enough

Friday, July 8th, 2011

mike elkYesterday, the World Trade Organization (WTO) ruled that China had illegally blocked the export of Chinese raw materials. Chinese tightening of raw material exports had the effect of artificially reducing prices for Chinese goods, because non-Chinese manufacturers couldn’t obtain materials as cheaply as Chinese firms could.

“The panel found that China’s export duties were inconsistent with the commitments that China had agreed to in its Protocol of Accession,” WTO judges said in a summary of its ruling. “Export quotas imposed by China on some of the raw materials were inconsistent with WTO rules.”

U.S. trade officials were quick to praise the ruling. The finding is “a significant victory for manufacturers and workers in the U.S. and the rest of the world,” U.S. Trade Representative Ron Kirk told Bloomberg News.

While some praised the ruling, however, United Steelworkers President Leo Gerard said  the WTO ruling showed that much more needed to be done to stop China from distorting markets.

“Kirk flagged the distortions caused by the export restraints on key raw materials. These restraints are not just used on the products subject to today’s decision but to rare earth elements, antimony, tungsten and many other products critical to green technology and other industries where China is succeeding by rigging the competition,” Gerard said in a statement.

Union officials officials including Gerard and AFL-CIO President Richard Trumka have long argued that in order to protect U.S. manufacturing, the United States must more aggressively enforce existing trade laws with the WTO and other organizations that regulate trade.

In order to file a complaint with the WTO accusing a country of illegal trade practice, the U.S. Trade Representative Office must do months, sometimes years, of investigation to prove damages being done in the United States and show that the Chinese are intentionally breaking the law. The process is slow and would require a dramatic expansion of resources dedicated to pursuing such complaints with the WTO in order to make trade law enforcement effective.

Many point to the issue of Chinese currency manipulation, which labor leaders like Gerard and Trumka say dramatically cheapens Chinese goods, as an issue that the United States has not moved aggressively enough on.

“The Obama administration deserves to be commended for its pursuit of this case and its focus on enforcement. Trade enforcement isn’t an esoteric issue, it’s about jobs. Unfortunately, China’s illegal, predatory and protectionist policies cover a substantial portion of its economy and that has allowed it great success at the expense of the U.S. manufacturing base and American jobs” Gerard said. “Still, a case-by-case approach takes time and allows China to get away with far too much. We need to accelerate action and also deal with issues like China’s currency manipulation to help level the playing field.”

While the United States Congress is now considering expanding free trade toKorea, Columbia and Panama, it’s a good time to note the difficulty of enforcing existing trade laws. If we can’t consistently enforce them, how will the U.S. government be able to ensure that Korea, Columbia and Panama play by the new rules?

This article originally appeared on the Working In These Times blog on July 7, 2011. Reprinted with permission.

About the Author: Mike Elk is a third-generation union organizer who has worked for the United Electrical, Radio, and Machine Workers, the Campaign for America’s Future, and the Obama-Biden campaign. Based in Washington D.C., he has appeared as a commentator on CNN, Fox News, and NPR, and writes frequently for In These Times as well as Alternet, The Nation, The Atlantic and The American Prospect.

China’s Currency Manipulation: Flipping Off America

Tuesday, September 21st, 2010

Leo GerardChina is disrespecting America.

The Asian giant is an international trade outlaw, and U.S. manufacturers and workers are its crime victims.

China illegally subsidizes its export industries and unlawfully manipulates its currency. That kills U.S. industry and destroys U.S. jobs. Earlier this year, the Obama administration asked China nicely to allow its currency value to float up naturally on international markets. On June 19, China said it would.

And then it didn’t.

That’s flipping the bird at America.

Before China’s June 19 promise, bipartisan groups of lawmakers in the U.S. House and Senate proposed legislation that would force the U.S. Treasury Department to even the score and to call China out for what it is: a currency manipulator. Hearings on the bills are being conducted this week.

Pass the legislation. It’s time for America to flip the bird back.

Negotiation and threats have failed to produce a sustained, substantial currency float by China. Now, the Chinese currency, the renminbi, is undervalued by as much as 40 percent, a figure accepted by conservatives like C. Fred Bergsten of the Peterson Institute for International Economics. Even the International Monetary Fund managing director said the currency is undervalued.

China simply denied it. In March, the Chinese premier, Wen Jiabao, said he did not believe the renminbi was undervalued. That’s flipping off the world.

It works like this: China prints renminbi to buy billions of U.S. dollars, which makes them appear more desired and valuable, and the renminbi, by contrast, less valuable. That undervaluation of the renminbi acts as a subsidy for Chinese exports, artificially making them as much as 40 percent cheaper when sold in the U.S. Conversely, it acts as a tax of as much as 40 percent on American-made goods sold in China.

This dynamic contributed significantly to the rise of manufacturing in China. Earlier this year, China surged past Japan to become the world’s second-largest economy. And it contributes significantly to America’s massive trade deficit. The gap in July was $42.8 billion, more than half of which — $25.9 billion — was a result of trade with one country – China.

China’s rapid economic growth has ended poverty for millions of its workers.  Here in the United States, however, China’s flouting of international trade law is destroying the lives of millions of workers. The Economic Policy Institute estimates that 2.4 million American jobs have been lost or displaced since 2001 as a result of the trade deficit with China. American workers celebrate their Chinese counterparts’ improved quality of life, but they condemn the government of China for accomplishing that with beggar-thy-neighbor trade practices.

Earlier this year, it briefly looked like threats would prompt China to act. In March, a bipartisan coalition of U.S. Senators introduced legislation specifying the factors necessary to label a country as a currency manipulator and detailing American reprisals. And in April, the Treasury Department delayed its report identifying countries that manipulate currency rates, suggesting that it was ready to take on China.

China appeared to respond to that pressure in June. It announced it would allow the renminbi to float toward its real value on the open market. The Treasury Department backed off, omitting China from its list of currency manipulators in July.

China then permitted the value of the renminbi to rise less than one percent. One percent. When it’s as much as 40 percent undervalued. That’s flipping the bird at America. Big time.

Still, America didn’t react.

On Aug. 25, the Commerce Department announced 14 new measures to crack down on trade violations, such as ending certain exemptions from duties.

It did not, however, mention currency manipulation.

Dan DiMicco, CEO at Nucor Corp., the largest U.S. steelmaker, said the 14 measures are important, but the problem with China won’t be resolved until the United States takes on currency undervaluation. Here’s what he said:

“As long as we continue to let them get away with it, they’ll keep doing it.”

Six days later, in a trade case filed by the U.S. Aluminum Extrusions Fair Trade Committee, a coalition of domestic manufacturers of aluminum extrusions and the USW, the Commerce Department again squirmed out of dealing with currency manipulation.

Commerce imposed import duties on Chinese aluminum companies because China unfairly subsidized $514 million in aluminum exports to the U.S. in 2009. But Commerce refused to investigate the Fair Trade Committee’s evidence that China’s currency manipulation functions as an additional illegal export subsidy.

Sen. Chuck Schumer of New York, a sponsor of currency manipulation legislation, said afterward:

“The Commerce Department made its finding while still managing to ignore the elephant in the room, which is China’s currency manipulation.”

Commerce and Treasury have decided the proper response to China flipping off America is averting their eyes.  See no evil.

Yesterday Japan followed China’s lead. It bought dollars and sold yen, decreasing the value of yen and increasing the value of dollars. This, the New York Times explained, was “a bid to protect its export-led economy.” That’s exactly what China is doing.

It’s a very public show of contempt for international regulations and for American citizens.

Normally, Americans don’t respond passively to contempt. Be normal, America.

About The Author: Leo Gerard is the United Steelworkers International President. Under his leadership, the USW joined with Unite -the biggest union in the UK and Republic of Ireland – to create Workers Uniting, the first global union. He has also helped pass legislation, including the landmark Canadian Westray Bill, making corporations criminally liable when they kill or seriously injure their employees or members of the public.

Free Trade Gets Some Fresh Thinking

Tuesday, August 18th, 2009

The Obama administration has taken some nice first steps toward a more worker-friendly vision of global trade. New free trade agreements pushed by the Bush Administration, such as those with Colombia and South Korea, are apparently getting some deep re-thinking – or at least, being put on the back burner while the new Administration sorts out climate change, health care and domestic trade union rights. And refreshingly, on July 16, the new United States Trade Representative Ron Kirk announced a more proactive strategy to enforce labor provisions in existing free trade agreements. Here’s what’s new under the sun.

First, a bit of explanation about what he’s talking about. Existing free trade agreements from NAFTA on through the most recent deals require our trade partners- at least on paper- to enforce their labor laws and to try to live up to international labor standards.  So what’s so striking about USTR Kirk saying that the Administration wants to make sure existing language in our trade deals is enforced?

In truth, no prior administration has ever sought to actually take the initiative when it comes to these provisions. Instead, we have assumed that of course all our trade partners are enforcing labor rights protections- except when someone points out they aren’t. In other words, enforcement of these provisions has been carried out largely on a complaint-driven basis. This model can’t really work, as the people who are most affected- the most exploited workers in the countries with which we trade- just don’t have practical means to access the mechanisms that have been set up for filing complaints. Thus, not surprisingly, very few complaints get filed, no matter how many abuses actually occur. Even when complaints do get filed- for instance, my organization, ILRF, filed about a dozen cases on behalf of Mexican workers in the early years of NAFTA- those cases take years to resolve, and workers see little return for the effort of engaging in the process.

But there is no downside to the US Trade Representative taking a new look at how we enforce these deals- and, we hope, finding a better way to do it. Real enforcement of the labor provisions in trade deals would be a win-win for both US workers and workers overseas.  Promoting policies that protect workers in other countries makes good sense for the US, economically.  Creating decent and sustainable jobs that raise developing country workers into the middle class is a win-win for workers and businesses, as it expands markets for US and global products. That has long been the main moral argument for more global trade- although few have cared to deal with the ugly reality that many workers in export industries in these countries have been getting sweatshop jobs, not decent jobs, and have not been able, in their lifetimes, to afford the goods they are producing.

Poor working conditions in developing nations not only strip laborers in those countries of their rights, but also create unfair competition in the global labor market. This global “race to the bottom” leads to degradation of conditions, to the increase in ‘sweatshop jobs,’ here at home. We need to bring up the bottom for everyone.

It’s great that USTR Kirk wants to hold trading partners accountable for labor rights, and would be even better if the new Administration sought ways to hold investors- the multinational companies that chase cheap labor around the globe- accountable as well. This would get us past the current ‘free trade’ model to one of what we might call fair trade. For example, we should be supporting terms of trade requiring that investors who benefit from trade deals agree to a floor of decent wages and working conditions that ultimately enable workers to lift themselves out of poverty, and should reward governments that institute laws and policies to regulate ‘footloose’ investors and require companies to make long-term commitments to investments- and their workforce- in developing countries. This is in all of our long term interests.

About the Author: Bama Athreya
is the Executive Director of the International Labor Rights Forum.

This article originally appeared on Union Review on August 4, 2009 and is reprinted here with permission from the author.

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