AFL-CIO President Says NAFTA Rewrite Not Worthy of Endorsement Yet

"Quite frankly, the auto workers think the rules of origin as currently stated are useless," he said, responding to a reporter's question after a speech Oct. 24 in Washington.

He said the proposal for a 10-year exclusivity period for biologics is "totally unacceptable," and he said the NAFTA rewrite has three problems with enforceability.

First, there's the ability of the Mexican government to follow through with the massive labor reform it has passed. He explained: "Mexico artificially kept their wages low as a way to do business. The tool they used to keep their wages artificially low was a protectionist contract." That arrangement, as unions see it, provides an incentive to move work from the U.S. and Canada to Mexico, as Mondolez Nabisco did last year.

Mexico says all those protectionist contracts will be overturned, and the workers in those unions will be able to vote for a true union, and that union will negotiate for the contracts they want, which should mean higher wages. But the scope is enormous -- 700,000 contracts, a new court system, as well as hundreds of thousands of outstanding labor complaints.

"They agreed to do all that in four years. I was skeptical," Trumka said. So he traveled to Mexico City and met Mexico's president, whom he called "absolutely sincere," but immediately added: "I think he truly underestimates the level of opposition in front of him."

He called the Mexican labor budget "voodoo economics," and said "the numbers just don't add up."

Another issue Trumka sees with enforcement is the state-to-state dispute settlement process. In NAFTA, any arbitration panel for a case can be blocked by any of the countries. When asked if that will be fixed, he said, "All of them are going to be fixed, or it won't pass."

Last, Trumka said even a functioning state-to-state dispute settlement process, as was present in the Central America Free Trade Agreement, takes too long. A labor complaint against Guatemala took 10 years to get to a decision, he noted. So Trumka supports two Democratic senators' proposal that would send inspectors to Mexican facilities where labor violations are alleged, and, if substantiated, the products from those factories would be barred from entry into the U.S.

Sen. Sherrod Brown, D-Ohio, patterned the proposal after the Peru agreement. "We thought if it's good enough for trees and animals, it ought to be good enough for people, so we would be like to be able to stop things at the border as well, whenever they're made in violation of the agreement."

Mexico opposes this proposal, and its assent would be needed to make the change.

Trumka said the Big Three automakers could influence unions' view of the new NAFTA if they tackled their own protectionist unions first. "The Italians have a saying, to trust is good, to not trust is better. Show us something," he said.

In a conversation with reporters after the talk, Trumka dismissed the goal that House Democrats talk about ratifying an improved trade pact before the end of the year. "This year? What's magic about this year? Don't set an artificial deadline for yourself.

"If they try to rush it, it will go down, because it's not worthy of the American economy and the American people. When it is worthy, we will bring it up. And I don't care whether it's November, January, or November of next year! When it's worthy of the American people, we'll give it our support. And if it isn't, we'll oppose it.

"We've had 25 years of experience with bad agreements. They've cost jobs, and destroyed communities, they've done a lot of damage to our industry. We're not going to make the same mistake."