What Trump's overhaul of NAFTA means for workers

One of Trump's main promises during his 2016 campaign was that he would revamp NAFTA

By Matthew Rozsa

Staff Writer

Published October 1, 2018 3:58PM (EDT)

 (AP/Photo montage by Salon)
(AP/Photo montage by Salon)

President Donald Trump managed to overhaul the North American Free Trade Agreement on Monday, bringing to fruition one of the main policy goals from his 2016 presidential campaign.

"It’s a great win for the president and a validation for his strategy in the area of international trade," one senior administration official told reporters during a press call, according to Politico. Technically the victory had been achieved in late August, when U.S. Trade Representative Robert Lighthizer announced that the Canadian and Mexican governments were working with the United States to finalize a trade deal, a draft of which would be made available to Congress by the end of September.

Yet the fact that a deal has been reached between the three countries doesn't mean that it will automatically take effect. Both the Republican and Democratic parties are likely to comb through the details of the new agreement to see if it aligns with their respective ideological goals. Democrats will be paying attention to the labor and environmental standards in the new agreement, while Republicans will want to make sure that it addresses intellectual property issues and dispute settlement.

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Wenonah Hauter, the executive director of Food & Water Watch, released a public statement after the text of the new deal was revealed that foreshadowed possibly environmentalist objections to the agreement.

The text reveals provisions that undermine U.S. food safety protections, including aggressive ‘sound science’ language designed to make it harder to defend or implement food safety safeguards. The text includes the type of attacks on commonsense public health standards that were championed by the disgraced Environmental Protection Agency Administrator Scott Pruitt. Including the ‘sound science’ red herring in trade pacts means that even after Trump leaves the White House, his deregulatory agenda is locked into international agreements.

The new text encourages the United States to accept the food safety rules in Mexico as comparable to domestic protections, and to accept imports from Mexico with less scrutiny than from other countries. The deal even creates new ways for Canada and Mexico to second-guess U.S. border inspectors that halt suspicious food shipments, which would have a dangerously chilling effect on food safety enforcement.

The new deal also has giant giveaways to the agrochemical industry that paves the way for unregulated gene-edited GMOs, rolls back Mexico’s regulation of GMOs, and lets chemical giants like Monsanto and Dow keep the data on the safety of their pesticides secret for 10 years.

The energy provisions will encourage more pipelines and exports of natural gas and oil that would further expand fracking in the United States and Mexico. The text also provides new avenues for polluters to challenge and try and roll back proposed environmental safeguards, cementing Trump’s pro-polluter agenda in the trade deal.

By contrast Matthew Shay, the president and CEO of the National Retail Federation, issued the following statement about the new trade deal.

We are pleased a deal has been reached that preserves NAFTA’s trilateral framework, which is critical to protecting North American supply chains that support millions of American jobs. The administration, as well as officials from Canada and Mexico, should be applauded for months of hard work aimed at modernizing NAFTA for the 21st century — a goal retailers have shared from the start. We will carefully review all the details of the agreement to ensure it promotes U.S. economic growth and maintains access to the products American families need at the prices they can afford.

Shay's optimism was echoed by Chris Garcia, the former deputy director of the US Department of Commerce.

"This new USNCA deal is, I think, the fruits of the hard bargaining that both the Trump administration and frankly the Mexican government and Canadian government all really put their hearts and soul into," Garcia told Salon. "Each knowing that this is a legacy piece, if you will, for each of their administrations, respectively. I think this is a win for the US worker, no matter which way you chop it. I think there's something in this for everybody."

He added, "Number One: It's a win for American workers that had been sold out under the NAFTA deal, the previous NAFTA deal. When you talk about having 75 percent automobiles' parts production required to be in the United States and in Mexico, that's a significant jump from the 62.5 percent. That's a major get. Breaking into the Canadian dairy market, that's a huge get, that's a major victory and a major concession that the Canadians made. And of course updating and modernizing all the different standards that are required between the three parties — IP protection, ecommerce protection and so forth. But there's something in this for everybody."

A more center-left trade expert did not share Garcia's enthusiasm.

"President Trump has called the new USMCA ‘the most important trade deal that we’ve ever made, by far.’ To the extent that the Administration is backing away from Trump’s earlier threats to blow up or emasculate NAFTA, that may be true," Ed Gerwin, a senior fellow for trade and global opportunity at the Progressive Policy Institute, told Salon by email. "To the extent that the USMCA is largely an elaborate rebranding exercise, it seems that the Administration could have accomplished that—and usefully modernized NAFTA—without repeatedly threatening the very foundations of North American trade."

Gerwin added, "On first glance, the USMCA hardly seems groundbreaking. It would modernize NAFTA by adding provisions derived from the Trans Pacific Partnership deal that the President abandoned, and would increase U.S. access to Canada’s dairy sector. But it’s far from clear whether its highly complex rules of origin for autos and other sectors would have the transformative economic effects that the Administration claims."

Gerwin also pointed out that "it’s noteworthy that the new agreement doesn’t eliminate U.S. 'national security' tariffs on aluminum and steel from Canada or Mexico—or the retaliatory tariffs that those countries continue to impose on American manufacturers and farmers. And the Agreement’s reliance on the threat of 'national security' tariffs on Canadian and Mexican cars is a particular concern. As it reviews that new deal, Congress needs to push back against these and other abusive efforts by the Administration to restrict trade and hijack trade powers that are vested by the Constitution in Congress."

By Matthew Rozsa

Matthew Rozsa is a staff writer at Salon. He received a Master's Degree in History from Rutgers-Newark in 2012 and was awarded a science journalism fellowship from the Metcalf Institute in 2022.

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Canada Donald Trump Mexico Nafta Trade