Respecting Creation: How to Navigate the NAFTA Renegotiation
José Arnulfo Cabrera
November 7, 2018
For the past year, the Trump administration has been renegotiating a new version of the North American Free Trade Agreement (NAFTA) with Mexico and Canada. Trade is a priority issue for President Trump and his Administration has emphasized the need to increase trade benefits to Americans as part of his “America First” agenda. While NETWORK affirms the need to improve the working condition in the United States, we also believe that any deal must benefit workers and those in poverty in all three countries. To that end, we and our faith partners sent a letter to the Administration outlining priorities for the renegotiation.
We have a 24-year track record with the current NAFTA agreement and we know that the agreement created great benefits for large corporations, but time and time again it has failed to benefit the common good. For example, NAFTA flooded the Mexican market with subsidized corn, wheat, and soy from the U.S., forcing literally millions of family farmers off their land. The pacts also allowed huge U.S. corporations to move in, driving tens of thousands of additional small- and mid-sized Mexican employers out of business. In fact, real wages in Mexico are lower today than before NAFTA was enacted. During this same period working families in the U.S. have suffered as well from flat wages and loss of jobs in the manufacturing sectors. The new NAFTA, if done right, has the opportunity to make incremental changes to the status quo.
On September 30, the Administration laid out newly designed NAFTA 2.0. NETWORK, along with our faith and secular partners, began reviewing the new deal with the hope that progress would be made. Thankfully, there were some important areas of progress made on key faith priorities. There are, however, areas where the new NAFTA fails. We expect the Trump Administration will sign the NAFTA 2.0 on November 30 and then send it to Congress for consideration under fast-track authority which allows for an up or down vote on implementing legislation without possibilities to filibuster. We don’t expect it to be taken up by Congress until early next year.
What does this mean for NETWORK advocates? Plain and simple, we must work over the next few months to seek changes to the agreement that will substantially improve NAFTA 1.0. As a faith-based organization, we believe the global economy must care about and respect people and creation. The renegotiation of NAFTA can and must make North America a model of the trade policy we want to see across the world.
Investor-State Dispute Settlement (ISDS): There are four areas where we see significant improvement in the new NAFTA 2.0. The first issue pertains to the Investor-State Dispute Settlement process, or ISDS, which gives giant corporations the ability to sue foreign governments over their domestic laws. To date, those courts have been used largely to attack domestic health, safety, and environmental laws. This gives a lot of power to corporations over affected communities. The new NAFTA completely eliminated the ISDS between the U.S. and Canada, and between the U.S. and Mexico the ISDS was replaced by a new version of ISDS. The new one eliminates extreme investors’ rights, and remedies key procedural concerns. Unfortunately, there is a loophole in U.S.-Mexico’s new ISDS that gives nine U.S. oil and gas companies power going into ISDS courts. NETWORK and our partners will work to close this loophole.
Labor: Faith partners affirm the need for strong worker protections in all countries so that workers receive good wages, have the freedom to organize and work in healthy and safe environments. The NAFTA 2.0 text establishes new rules to end wage suppression “protection contracts” in Mexico – which, if enforced, could make a big difference over time on Mexican wage levels and incentives to outsource U.S. jobs to Mexico. Recently, Mexican workers arrived at a new plant to find that a “union” they never voted for has signed a contract they never approved locking in low wages. Workers who strike are fired. Labor organizers face violence and intimidation. This is a step forward.
The key problem is that there is no language that ensures these rules will be enforced. Unless strong labor standards are made subject to swift and certain enforcement there is no way to ensure the new rules are implemented. NETWORK and our partners will continue to work to improve the agreement so it contains real enforcement mechanisms that allow workers to thrive. Without enforcement of these new rules, they are meaningless.
Environment: To have a global economy that cares and respect all creations we must uphold environmental protections. NETWORK recognizes that climate change is real and disproportionately affects the poorest residents, especially the poor in developing countries and small islands. We can’t accept or have a trade deal that continues to contribute to climate change. NETWORK, along with our faith partners, hoped to see the new NAFTA prioritize long-term ecological sustainability. NAFTA 2.0 eliminated the forces that made countries export natural resources that they seek to conserve. This is a good start, but NAFTA 2.0 still has a long way to go. Unfortunately, NAFTA 2.0 failed to adopt, maintain, implement, and enforce domestic laws that ensure the seven core multilateral environmental agreements. The deal also failed to mention the word “climate change” along with stating the economic and national security challenges that climate change creates.
Access to Medicine: This is one of the biggest failures in the current NAFTA 2.0. NETWORK is a strong believer in affordable medicine and healthcare for all. Therefore, we want NAFTA 2.0 to increase access to affordable medicine, not to limit it. Further, we believe the U.S. government should prioritize pharmaceutical corporations and allow them to continue monopolizing their product through trade agreements. The new NAFTA keeps expanding the monopoly of big pharmaceutical companies, and allows many big pharma companies to keep medicine prices high, and moves further away from affordable medicine. We are working with our faith partners to change the current pharmaceutical language so we can begin to move towards more affordable medicine and eliminate the current monopoly pharmaceutical companies have now. NETWORK will work to eliminate the bad policies included in NAFTA 2.0 which line the pockets of pharma will harm patients.
Agriculture: NAFTA 2.0 does not address the needs of small farmers and locks in many of the agriculture rules that have devastated family farmers. In fact, NAFTA 2.0 seeks to provide new intellectual property rights that stop farmers from being able to save and share protected seeds. The new NAFTA allows agricultural biotechnology products that will bypass national efforts to ensure safety, effectiveness, and impact on workers, rural communities and ecosystem should be rejected. All of the current agriculture problems NAFTA has created allows big corporate farmers to overpower small farmers in all three countries; because of that, it is slowly monopolizing farming. NETWORK will continue to work to protect small farmers.