Despite recurring promises with each new free trade agreement that it will create millions of living wage jobs, workers under NAFTA-style trade deals have suffered increased outsourcing of jobs, inhumane working conditions, and stagnant wages in Washington, in the United States and around the world.
For too long, our nation’s trade and investment policies have reflected the influence of powerful corporate interests. They protect what’s important to corporate America but do little or nothing to safeguard the rights of workers and the environment here and around the world. They fuel a race to the bottom in living standards. That needs to change. We need policies that support good jobs at home and sustainable development abroad. We need to enforce the laws already on the books and stop blatant abuses by some countries that stack the decks against U.S. workers.
In the TPP negotiations, a handful of representatives for organized labor fought hard and won a seat at the table (more than 80% of the 600 trade advisors represented multinational business interests, however). However, after 5 years of having their recommendations ignored, they decried publicly being given limited access but no influence whatsoever, and have been very clear that the resulting trade agreement will undermine, instead of raising up, workers in the US and worldwide. Check out the Labor Advisory Committee full report here.
How does the TPP undermine workers?
The TPP allows currency-manipulating countries to kill U.S. jobs. The current TPP text doesn’t contain enforceable currency manipulation rules. Countries that intentionally devalue their currency cheat U.S. manufacturers and undermine any benefits from tariff reductions. Enforcing currency manipulation rules is probably the single most effective thing the United States could do to create jobs; in fact, doing so could add as many as 5.8 million jobs.1
The TPP doesn’t strengthen international labor rights protections. There are extensive, well-documented labor problems in at least four TPP countries (Mexico, Vietnam, Brunei and Malaysia)3 but the administration has not committed to requiring all countries to be in full compliance with international labor standards before they get benefits under the agreement. Worker rights obligations have never been fully enforced under existing free trade agreements, which have provided too much discretion for worker complaints to be delayed for years or indefinitely (e.g., Honduras, Guatemala). A progressive TPP would eliminate this shortcoming, not repeat it. Given that no administration has ever self-initiated labor enforcement under a free trade agreement, any promise to “strongly enforce” the TPP should be met with skepticism.
The TPP could allow public services to be permanently outsourced. Public services such as sanitation, transit and utilities should be carved out of trade deals—but the TPP puts them at risk. The current TPP text does not ensure that governments can pull out of wasteful and failing public service privatization efforts without shelling out taxpayer dollars or otherwise compensating foreign firms or trading partners.4
The TPP allows foreign state-owned enterprises to continue to undermine small business. The current TPP text doesn’t adequately protect small businesses from the predatory tactics of foreign state-owned and state-subsidized companies. Often, these enterprises benefit from government support and drive their American competitors out of business or put pressure on our companies to ship American jobs overseas. While the TPP contains some limited provisions to address state-owned enterprises, it’s not clear it would level the playing field and provide the fast action small firms need to stay in business when faced with unfair competition.
The TPP’s weak rules of origin benefit China and other non-TPP countries. The rules of origin in the current TPP text are weak and allow China and other nonparticipating countries to reap the agreement’s benefits without having to follow its rules. In fact, the TPP’s auto content requirement allows the majority of the auto content to be Chinese and manufactured outside the trade agreement’s rules. This has the effect of promoting jobs in China while destroying U.S. auto supply-chain jobs.
The TPP takes America out of “Buy American.” The current TPP text will require the U.S. government to treat Vietnamese, Malaysian and other TPP firms exactly the same as U.S. firms for many purchasing decisions—even when “Buy American” rules apply. This will send U.S. taxpayer dollars overseas and undermine U.S. job creation efforts. It is also unclear whether responsible bidding requirements (for example, a bidder must have “clean hands” or provide benefits to same-sex spouses) will be free from trade challenges.
The TPP gives global banks even more power. The current TPP text could make it even harder for countries facing an economic crisis to stabilize their economies. Not only can large international banks still sue countries in crisis using the “prudential exception,” the TPP expands the rights of international banks to use ISDS to challenge bank regulations in front of private tribunals. Giving global banks more power makes another global financial meltdown more likely, not less.
We need a trade agreement that works for America’s working families. Read the latest news and take action at http://www.aflcio.org/Issues/Trade