Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘WTO’

Make American Jobs

Monday, February 13th, 2017

President Donald Trump had Harley-Davidson executives and employees over to lunch at the White House last week and reiterated his promise to end wrong-headed trade policies that enable foreign countries to eat American workers’ lunch.

Trump reassured the Harley workers from the United Steelworkers (USW) union and the International Association of Machinists (IAM) that he would renegotiate NAFTA and other trade deals.

“A lot of people [have been] taking advantage of us, a lot of countries [have been] taking advantage of us, really terribly taking advantage of us,” he said as news cameras clicked. “We have to be treated fairly.”

No promise could be more heartening to workers as corporations like Carrier and Rexnord continue to move jobs to Mexico. No news could be better in the same week that the Economic Policy Institute (EPI) released research showing that since 2001, the United States’ massive trade deficit with China cost 3.4 million Americans their jobs.

EPI-jobs-China-Gerard-OurFuture

Workers, families and communities have suffered as trade and tax policy over the past quarter century encouraged corporations to off-shore factories and jobs. Flipping that philosophy to favor American workers and domestic manufacturing is exactly what labor organizations like the USW have long fought for. If Trump actually achieves that, all Americans will benefit.

In the meantime, Rexnord Corp. has finalized plans to uproot its bearings manufacturing machines in Indianapolis, transport the equipment to Mexico and throw 300 skilled and dedicated workers, members of my union, the USW, into the street. Terminations begin Feb. 13.

Automation did not take these workers’ jobs. The lure of dirt-cheap wages in Mexico and tax breaks awarded for the costs of moving jobs and machinery stole them.

Trump talked to the Harley workers and executives about changing tax policy. Ending all special tax deals and loopholes that corporations like Rexnord and Carrier use for shuttering American factories and shipping them to other countries would be a good first step. U.S. policy shouldn’t reward corporations like Rexnord and Carrier that profit from exploiting the international wage race to the bottom and the wretched environmental regulation of emerging nations.

Harley-Gerard-OurFuture

Caption: Photo by Vlad/Flickr

The next logical step would be establishing consequences for those corporations — like requiring them to pay substantial economic penalties if they want access to the U.S. market for their once-domestic and now foreign-made products.

In addition, American policy must be —  just as Trump promised in his campaign — to stop trade law violators who are trampling all over American workers.

The EPI study detailed the devastation caused by the worst violator — China. American workers and companies can compete on a level playing field with any counterpart in the world. But the EPI study shows just how much American workers and their employers suffer when the United States fails to strictly enforce international trade law.

Of the 3.4 million jobs lost between 2001 and 2015 because of the U.S. trade deficit with China, EPI found that nearly three-quarters of them, 2.6 million, were manufacturing jobs. Every state and every congressional district was hit. These are jobs fabricating computer and electronic parts, textiles, apparel and furniture.

Manufacturing jobs such as these provide family-supporting wages and benefits such as health insurance and pensions. As these jobs went overseas, American workers’ income stagnated while those at the top — executives, 1 percenters and corporate stockholders — benefited.

As the rich got richer, the EPI researchers found, all non-college educated workers lost a total of $180 billion a year in income.

When the United States agreed to allow China into the World Trade Organization (WTO) in 2001, former President Bill Clinton said the access that the deal provided American companies to the gigantic Chinese market would create jobs. Promises, promises.

It’s possible no one guessed just how massively China would violate the trade rules it agreed to abide by under the WTO pact. Numerous investigations by the Department of Commerce have found China improperly subsidizes its exports by providing artificially cheap loans, free land, and discounted raw materials and utilities. To keep its workers employed, China helps finance overproduction in industries like steel and aluminum, then dumps the excess at below-market prices in the United States, bankrupting mills and factories here.

China pirates innovation, software and technology from foreign producers. To steal trade secrets, its military hacked into the computers of American corporations and the USW. In addition, China has manipulated the value of its currency so that its exports are artificially cheap and imports from the United States are artificially expensive.

Even if the scale of violation was underestimated, when it occurred, the American government had a responsibility to take action, to file trade cases, to take issues before the WTO, to negotiate to bring China in line with international standards and protect American jobs and preserve domestic manufacturing, which is crucial to national defense.

Precious little of that occurred. The trade deficit with China exploded, obliterating American jobs — a quarter million on average every year since China joined the WTO in 2001. China exports to the United States its overproduced aluminum, steel and other commodities, but also its unemployment.

After that lunch, Trump thanked Harley-Davidson for assembling its iconic motorcycles in America. He extended his hand in aid, saying, “We are going to help you, too. We are going to make it really great for business, not just for you, but for everybody. We are going to be competitive with anybody in the world.”

American workers and domestic manufacturers already are competitive. What they need is a government that doesn’t require them to compete with a handicap so huge that it’s like asking Evel Knievel to jump his Harley-Davidson XR 750 over 19 cars without a ramp. What they need is tough action against corporations that renounce their birthplace for profit and against flagrant, job-stealing trade violators like China.

This post originally appeared on ourfuture.org on February 7, 2017. Reprinted with Permission.

Leo Gerard is the president of the United Steelworkers International union, part of the AFL-CIO. Gerard, the second Canadian to lead the union, started working at Inco’s nickel smelter in Sudbury, Ontario at age 18. For more information about Gerard, visit usw.org.

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.

Assert Yourself, America; Don't be an Illegal Trade Victim

Tuesday, September 14th, 2010

Leo GerardLong-suffering victim is hardly the American image. Paul Revere, Mother Jones, John Glenn, Martin Luther King Jr. — those are American icons. Bold, wry, justice-seeking.

So how is it that America finds herself in the position of schoolyard patsy, woe-is-me casualty of China’s illegal trade practices that are destroying U.S. renewable energy manufacturing and foreclosing an energy-independent future?

Come on, America. Show some of that confident pioneer spirit. Stand up for yourself. Tell China that America isn’t going to hand over its lunch money anymore; international trade law will be enforced now.

That’s the demand the United Steelworkers (USW) union made this week when it filed a 5,800-page suit detailing how China violates a wide variety of World Trade Organization (WTO) obligations.

The case, now in the hands of the U.S. Trade Representative, shows how China uses illegal land grants, prohibited low-interest loans and other outlawed measures to pump up its renewable energy industries and facilitate export of those products at artificially low prices to places like the United States and Europe.

The U.S. aids renewable energy industries, like solar cell and wind turbine manufacturers, but no where near the extent that China does. And the American aid lawfully goes to renewable manufacturers that produce for domestic consumption. China, by contrast, illegally subsidizes industries that export, a strategy that kills off competition.

The USW recognizes and appreciates that trade with China has lifted millions there out of poverty. But truly fair trade would benefit workers in both China and the United States. And that is what the USW is demanding.

The USW is far from alone in accusing China of violations. New York Times reporter Keith Bradsher described them in a story Sept. 8, titled “On Clean Energy, China Skirts Rules.” It ends with this quote from Zhao Feng, general manger of Hunan Sunzone Optoelectronics, a two-year-old solar panel manufacturer that exports nearly 95 percent of its products to Europe and is opening offices in three U.S. cities to push into the American market:

“Who wins this clean energy race really depends on how much support the government gives.”

The U.S. isn’t providing support that violates WTO regulations. China is. And it’s hundreds of billions — $216 billion from China’s stimulus package, another $184 billion to be spent through 2020, $172 million in research and development over the past four years.

Bradsher’s story details illegal aid given Sunzone and says that it’s common, not exceptional. It includes China turning over land to Sunzone for a third of the market price and government-controlled banks granting Sunzone low-interest loans that the provincial government helps Sunzone repay.

In addition, the USW suit notes that China, which accounts for 93 percent of the world’s production of so-called rare earth materials like dysprosium and terbium essential for green energy technology, has severely restricted their export. That practice, illegal under WTO rules, forces some foreign companies to move manufacturing to China to get access.

And when corporations move, China routinely – and illegally — mandates they transfer technology to Chinese partners, which often means U.S.-tax-dollar-supported research and development benefits China.

That is one reason China rose to first in the world in clean energy so quickly. China now leads globally in producing solar panels. It doubled its wind power capacity in one year – 2009. Worldwide, Chinese manufacturers supply at least half of all hydropower projects and fabricate 75 percent of all compact fluorescent light bulbs.

Meanwhile, here in the United States, BP shut down its solar panel manufacturing plant in Maryland this year and Evergreen Solar of Marlboro, Mass., plans to close its American plant, eliminating 300 U.S. jobs. Both are moving manufacturing to China.

Germany’s Solar World still manufactures in Europe and the United States, and its chief executive, Frank A. Asbeck, told Bradsher the German solar industry association is investigating whether to file a suit of its own to try to stop China’s illegal practices:

“China is cordoning off its own solar market to fend off international competition while arming its industry with a bottomless pile of subsidies and boundless lines of credit.”

The Times story also says China’s “aggressive government policies” are designed to ensure “Chinese energy security.”

China’s illegal aggression to secure its energy independence and dominate world production of green technology threatens the energy security of the United States.

America turned to renewables not just to diminish climate change but also to reduce dependence on foreign oil, an addiction that has entangled the U.S. in costly and bloody wars.

If the United States can’t build its own renewable energy products, it will forfeit the next generation high technology industry and good manufacturing jobs, and it will remain dangerously beholden to foreign nations for energy.

China agreed to follow international regulations when it joined the World Trade Organization. This pledge was crucial because China’s economy is government-controlled, very different from the free market economies of the United States and most Western nations.

Faced with blatant rule-flouting that has cost USW members their jobs and threatens to cost their children high-technology manufacturing of the future, the USW is demanding the American government put a stop to it.

That is how a true American acts. Americans have a sense of justice. They follow the rules and expect trading partners to do the same. When they don’t, Americans do something about it.

Your Rights Job Survival The Issues Features Resources About This Blog