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Trump’s NAFTA 2.0: An Environmental Failure

Before, during, and after the Trump administration’s renegotiation of NAFTA, leading environmental organizations
repeatedly named specific changes to curb NAFTA’s environmental damage. The administration ignored nearly all of our
concerns, producing a deal in 2018 that would exacerbate the climate crisis, encourage further outsourcing of pollution
and jobs, offer handouts to notorious corporate polluters, and prolong Trump’s polluting legacy for years.

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To correct these environmental failures, environmental groups repeatedly offered detailed recommendations for essential
changes to the 2018 deal, as summarized in a recent letter to Congress. On December 10, 2019, the Trump administration
signed a “protocol of amendment” with some revisions to the 2018 deal. A review of the text of the protocol reveals that
the deal’s core environmental failures have not been resolved.
Below are the essential changes to NAFTA 2.0 that the environmental community has consistently called for, and an
assessment of whether the revised deal meets the mark, based on the text of the 2019 revision. In short, the revised deal
would perpetuate NAFTA’s environmental damage.

1. Binding climate standards: FAIL
● Why it matters: Binding climate standards are essential to curb outsourcing of climate pollution and jobs and to
ensure the U.S. and its trading partners fulfill commitments to the Paris Climate Agreement. The U.S. is by far the
world’s largest outsourcer of climate pollution, thanks in part to trade deals that ignore climate change. In
September, 110 members of Congress called for binding climate standards in a renegotiated NAFTA, reinforcing
a longstanding demand of the environmental community.
● What’s in NAFTA 2.0: Far from including binding climate standards, the 2018 deal failed to even mention
climate change. Nor does the 2019 revision. This glaring omission would leave intact NAFTA’s incentives for
corporations to dodge the hard-fought clean energy policies of U.S. states by moving to Mexico, eliminating jobs
and perpetuating climate pollution.
2. Binding clean air, water, and land standards: FAIL
● Why it matters: There is a well-documented track record of corporations using NAFTA to dodge our hard-fought
environmental standards by shifting their production to Mexico, free of charge, to dump toxic air and water
pollution under Mexico’s weaker environmental policies. The result has been job loss in the U.S. and toxic
poisoning in border communities. To reverse this damage, we have consistently called for a revised deal to
include binding limits on air, water, and land pollution.
● What’s in NAFTA 2.0: The 2018 deal barely mentions pollution and fails to include specific and binding terms to
actually address documented pollution dumping. For example, the text “recognizes that air pollution is a serious
threat to public health,” but then fails to include a single binding rule to reduce the air pollution that NAFTA has
exacerbated. The 2019 revision repeats this failure by omitting essential limits on air, water, or land pollution.
3. Obligations to fulfill commitments under key multilateral environmental agreements: PARTIAL FAIL
● Why it matters: The environmental community asked for a renegotiated NAFTA to require each country to adopt,
maintain, and implement policies to fulfill their obligations under top-priority Multilateral Environmental
Agreements (MEAs), including all of the MEAs to which the U.S. is a party and other critical MEAs ratified by most
countries in the world. Otherwise, countries will continue to have the incentive to violate their MEA commitments in
order to boost trade or investment, spelling threats to air, water, climate stability, and ecosystems.
● What’s in NAFTA 2.0: The deal replicates the same, inadequate list of seven MEAs that were reinforced in the last
four U.S. trade agreements. (The 2019 revision returns to the inadequate status quo after the 2018 deal took a step
backwards by only effectively reinforcing one MEA.) The deal makes no mention of additional top-priority MEAs

that serve critical roles for trade-related environmental protection, including other MEAs ratified by the U.S. and/or
nearly all countries in the world concerning climate change, transboundary air pollution, mercury pollution,
protection of the Caribbean, and other environmental priorities.
4. A new, independent and binding enforcement system to stop environmental violations: FAIL
● Why it matters: Under the enforcement mechanisms of existing U.S. trade agreements, the U.S. has never even
brought a case against a trade partner for systemic environmental abuses, despite widely documented violations.
To correct this categorical failure, we have repeatedly called for an effective enforcement mechanism that is both
binding and independent. That means creating a body of environmental experts, independent from any
government (to avoid conflicts of interest), to proactively investigate and initiate cases against environmental
abuses. And it means that findings of environmental abuses must be subject to trade sanctions.
● What’s in NAFTA 2.0: Instead of including an independent and binding enforcement system for environmental
terms, the 2018 deal largely replicated the same, weak enforcement mechanisms of past trade deals that have
consistently failed to curb environmental abuses. The 2019 revision repeats this failure, as it does not create an
independent body to investigate and initiate cases against environmental abuses. Instead, the implementing
legislation for NAFTA 2.0 creates an “interagency committee” that is not independent and that has virtually no
power to correct environmental abuses. The committee can only write non-binding reports and in rare instances
issue non-binding recommendations. The committee is chaired by the U.S. Trade Representative, an agency
whose clear conflict of interest has consistently inhibited environmental enforcement in U.S. trade deals to date.
Due to this copy and paste of a failed enforcement system, the environmental terms of NAFTA 2.0, even if they
were strong, are unlikely to be enforced.
5. Removal of corporate polluter handouts that support tar sands oil and fracked gas: FAIL
● Why it matters: The Trump administration’s 2018 text included a new “rule of origin” that would make it cheaper
for oil corporations to export climate-polluting tar sands oil to the U.S. through dangerous oil pipelines like
Keystone XL. The text also failed to include a provision that is needed to preserve the U.S.’s autonomy to
determine if gas exports to Mexico and Canada are in the public interest. This provision is necessary to fix
NAFTA’s automatic gas export guarantee, which has contributed to a five-fold surge in gas exports to Mexico
since 2010, fueling increased fracking in the U.S. and expansion of controversial cross-border gas pipelines.
● What’s in NAFTA 2.0: The deal’s 2019 revision keeps intact both of these handouts to corporate polluters. As
such, the deal would promote reliance on fossil fuels, undercutting our transition to a clean energy economy.
6. Elimination of broad rights for corporate polluters to sue Mexico over environmental policies: FAIL
● Why it matters: While the 2018 text curtailed NAFTA’s Investor-State Dispute Settlement system, it preserved
this illegitimate, shadow legal system for notorious corporate polluters like Chevron and ExxonMobil. The deal
would let oil and gas corporations with Mexican government contracts sue Mexico over climate and
environmental protections in private tribunals, using the same broad corporate rights that they’ve repeatedly used
to successfully challenge environmental policies.
● What’s in NAFTA 2.0: The 2019 revision failed to eliminate this clear-cut handout to oil and gas corporations. As
such, the revised deal would allow corporate polluters to sue Mexico in private tribunals if new environmental
policies undercut their government contracts for offshore drilling, fracking, oil and gas pipelines, refineries, or
other polluting activities.
7. Elimination of rules that would help corporate polluters weaken our environmental regulations: FAIL
● Why it matters: The 2018 text included new, binding rules – not found in any prior U.S. trade agreement – that
offer corporations multiple opportunities to challenge proposed regulations before they are finalized, and to ask
that existing regulations be “repealed” for being more burdensome than necessary. After Donald Trump leaves
office, we will need to swiftly enact stronger environmental regulations to reverse his administration’s many
harmful environmental rollbacks. That task will be difficult if regulators face onerous requirements to justify
proposed regulations in response to repeated challenges from the corporations that would be regulated.
● What’s in NAFTA 2.0: The deal’s 2019 revision failed to revise or delete these deregulatory rules. As such,
NAFTA 2.0 could help corporations slow down or weaken the process of re-regulation, extending Trump’s
polluting legacy even after Trump leaves office.

Taken From: https://www.sierraclub.org/sites/www.sierraclub.org/files/Trump-NAFTA-Environment-Failure.pdf

How About Some NAFTA Rights for U.S. Workers?

The Trump administration’s efforts on behalf of Mexican labor belie an aggressive anti-worker project at home.

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his week, our friend Senator Sherrod Brown of Ohio took the Senate floor to explain how the Brown-Wyden amendment to the new NAFTA deal strengthens rights of workers in Mexico. As Brown explained:

A worker in Mexico will be able to report a company violating their rights, and within months … We can apply punitive damages when corporations stop workers from organizing, and if they keep doing it, we can stop their goods from coming into the U.S. at all.

When Mexican workers have the power to form real unions and negotiate for higher wages, it helps American workers. Right now, Mexican workers can be paid as little as $6.50 a day—not an hour, a day. And we’ve been asking American workers to compete with that.

This is real progress, and heaven knows our brother and sister workers in Mexico, whose nominal right to form independent unions has never been respected, need these protections. And good on Brown and Senator Ron Wyden for demanding that these improvements be included in the new U.S.-Mexico-Canada deal (USMCA) that replaces NAFTA.

At the same time, there is something a little weird about the Trump administration agreeing to provisions protecting workers in Mexico—that walled-off land of rapists and criminals—while his Labor Department and National Labor Relations Board have been doubling down on the project of destroying unions and collective bargaining at home. The new USMCA doesn’t touch that.

The law requires the labor board to have members from both parties. But with the expiration of Democrat Lauren McFerran’s term in mid-December, the board for the first time in its 85-year history is comprised of three Republicans, all of whom happen to be white men—and not a single Democrat. The other Democratic seat on the five-member board has been vacant since last August, but the Trump administration has not moved to fill it.

The board has taken its agenda directly from the U.S. Chamber of Commerce, which has proposed ten measures to weaken worker protections. All ten have either been enacted by the NLRB or are in process.

These include overturning Obama-era rules that made it harder for management to delay union representation elections; increasing management’s ability to require workers with grievances to use compulsory arbitration typically rigged in the company’s favor; making it easier for management to impose disciplinary penalties on workers without bargaining with the union; allowing management to prohibit employees from using the company email system to discuss workplace issues with other employees; and a great deal more.

For a full summary of Trump anti-worker NLRB actions, check out this report from the Economic Policy Institute.

Thanks to the clear bias of the labor board, which is supposed to be a neutral referee and upholder of the law, union busting by management has reached new heights. According to another EPI research report, in more than half of all NLRB-supervised elections in bargaining units with 60 or more employees in 2016 and 2017, management was charged with violations of law. One pro-union worker in five was fired, and nearly one in three was disciplined, according to data obtained under the Freedom of Information Act.

The Trump NLRB has also changed the rules to make it easier for employers to treat workers as independent contractors rather than employees. Meanwhile, the Occupational Safety and Health Administration has several proposed or pending rules, including rules governing permissible noise levels in construction, safety rules in welding, and permissible chemical exposure levels.

In short, it’s open season on workers and unions, with the federal government openly working to help enable the corporate anti-union and anti-worker agenda.

When the labor provisions of the revised NAFTA were first proposed, some hoped that it would provide a basis not just for Mexican workers to challenge unfair labor practices in their country, but for American workers to do likewise. That never happened.

It is more than a little ironic that Donald Trump, probably the most viciously union-busting president ever, as well as a demonizer of all things Mexican, should get some credit for being pro-worker because the revised NAFTA modestly enhances enforceable rights for Mexican workers.

Whatever happened to Make America Great Again? What’s good enough for Mexican workers should be good north of the border, too.

Taken From: https://prospect.org/labor/how-about-some-nafta-rights-for-u-s-workers/

America’s food safety takes back seat in new trade deal

American consumers today are empowered with more information than ever before. With smartphones, social media, and countless online reviews at their fingertips, it’s never been easier to learn everything about the products they buy. But when it comes to the food they buy, millions of Americans are still in the dark about a big detail – where their food is from.

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When shoppers go to the grocery store, they can pick up a package of ground beef that says, “Product of the U.S.A,” but it could be from cattle born, raised and slaughtered outside of the U.S. Families want to buy American-made products they know are safe. They want to support the American jobs that produce that food. And they should be able to do that.

While the new U.S. trade deal with Mexico and Canada (USMCA) makes important improvements to NAFTA, it fails to include the strong country of origin food labeling we need to empower consumers and support American workers. This would significantly improve American food safety and invest in good-paying American jobs. It is deeply concerning that this essential provision was left out of the trade deal.

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Americans deserve to know their food is safe, but loopholes currently allow many companies to keep consumers in the dark about where their food is from. Under current rules, companies don’t have to disclose the country of origin for a wide range of food products, including salad mixes with dressing packets, pre-cooked or marinated meat and poultry, and mixed fruits and vegetables.

With the U.S. importing more than $140 billion of food every year, strong country of origin labeling is essential as food safety standards can vary significantly from one country to the next. And with food recalls up 10 percent since 2013, there has never been a more important time to put American consumers first with stronger food safety and transparency.

Strong country of origin labeling on food will also strengthen our economy. Boosting sales for American-made food would give a big lift to our country’s farmers and ranchers who face record low incomes and bankruptcies. It would help rebuild America’s cattle herd and bring back thousands of good-paying beef sector jobs lost to recent droughts. And stronger food transparency would also support good middle class jobs throughout our country’s meat industry.

America has a long history of empowering consumers and supporting our country’s workers with this type of labeling. In 1930, Congress passed a law requiring that almost all imports needed to carry country of origin labels. In 2002, this was expanded to food products like beef, lamb and pork, as well as fish, peanuts and fresh fruits and vegetables.

However, food companies pressured Congress to weaken food transparency and the new food labeling requirement was repealed in 2015. With today’s weaker food safety standards, companies can freely move food products across borders, put pressure on prices and wages, and leave everyday Americans behind.

Americans strongly support fixing this by closing food safety loopholes, with 89 percent in favor of country of origin food labeling. Our country has an opportunity to put the power back in the hands of consumers by giving them the facts about their food.

As farmers, workers and consumers, we are calling on Congress to reinstate commonsense labeling requirements. Together, members of the United Food and Commercial Workers (UFCW), National Family Farm Coalition, and Family Farm Defenders have proudly worked for generations to provide families with the safe and affordable food they deserve.

Free markets are strongest when consumers are empowered with the information they need to make the best choices for their families. Our leaders need to stop catering to companies that are more focused on outsourcing jobs and boosting profits than the consumers they serve.

Congress must stand up for American families and workers and enact strong country of origin food labeling. This will strengthen our economy and ensure that all Americans have the facts about the food they feed their families.

Whether it is through an update to the USMCA trade deal or through new legislation, one thing is clear: Americans cannot wait any longer for this critical investment in food safety and the good-paying jobs our families need.

Taken From: https://thehill.com/blogs/congress-blog/politics/475808-americas-food-safety-takes-back-seat-in-new-trade-deal

NAFTA’s Empty Promises

In the early ’90s, champions of the original North American Free Trade Agreement (NAFTA) promised farmers and workers a pot of gold at the end of the rainbow. Midwest farmers would export to prosperity. Manufacturing jobs would boom. Mexico’s middle class would grow and northern migration would slow. Now we are being told new fantastical tales that Congress must approve President Trump’s new NAFTA to aid our struggling farmers.

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Agribusiness and farm commodity groups are leading a well-funded lobbying blitz to gain congressional approval of the new NAFTA, officially known as the US-Mexico-Canada Free Trade Agreement (USMCA), before the holiday recess. Republican senators like Iowa’s Chuck Grassley and Jodi Ernst are parroting the urgent call that farmers need a win with the USMCA after trade disruptions with China and uncertain ethanol markets.

But what exactly is the win for farmers in the new USMCA? Nearly all tariffs for agriculture were removed under the original NAFTA. The International Trade Commission, which analyzes trade deals for Congress, projected that the USMCA would result in a slight net deficit for agriculture trade: meaning we would import slightly more than export. The small projected increase in agriculture exports – mostly dairy to Canada – would have no substantive effect on the ongoing, dramatic loss of small and mid-sized dairies in the Midwest.

Grading trade deals solely on the value of goods crossing the border has always obscured the real winners and losers. The original NAFTA, combined with the formation of the World Trade Organization (WTO) and the 1996 Farm Bill, led to the ramping up of agricultural production and an increase in agriculture exports. It also led to an almost immediate drop in commodity crop prices and farmer income. In fact, since the original NAFTA we’ve seen the steady consolidation of agribusiness firms and of farmland ownership, the loss of hundreds of thousands of small and mid-sized farms and independent ranches, and the rapid growth of large-scale concentrated animal feeding operations (CAFOs) fueled by cheap (often below cost) feed. We now have a largely integrated North American agriculture market, where young cattle from Mexico and feeder pigs from Canada routinely cross borders to be finished here. For agriculture, NAFTA’s real winners were not countries, but global agribusiness firms like Cargill, JBS, Tyson and Smithfield that operate in all three countries.

Mexican and Canadian farmers have also borne the brunt of NAFTA. Researchers estimate that more than two million Mexicans, one-quarter of the farming population, left agriculture in the wake of NAFTA’s flood of imports. And over the last 30 years, Canada has lost one-third of its farm families.

Instead of slowing migration, the passage of NAFTA caused the number of Mexicans crossing the border looking for work to more than double in the 15 years following. Many former Mexican farmers ended up coming north, working in fruit and vegetable fields or meatpacking plants.

Nothing in the USMCA addresses the enormous human cost of the original agreement. It also repeats NAFTA’s favors to multinational corporations. In service to the big meatpackers, Trump’s trade negotiators ignored calls from farm groups to include mandatory country of origin labeling (COOL) for beef and pork. In a gift to drug companies, the USMCA locks in lengthy patents for prescription drugs and adds a 10-year monopoly period for many life-saving biologic medicines. And for the big oil and gas companies, special rights to protect efforts to exploit Mexico’s valuable oil fields – setting back efforts to address climate change.

Democratic presidential candidates have been too tentative to specify what an alternative re-negotiated NAFTA could look like. If grounded in improving the lives of people instead of the corporate bottom lines, a new NAFTA could support policies in all three countries to ensure fair prices for farmers, address non-competitive markets and require mandatory COOL; protect the rights of workers to collectively bargain and establish strong minimum wage levels; and set a high bar for health and environmental protections and climate action. We also badly need to reform trade negotiations from secret, behind-closed-doors negotiations where corporate advisors thrive, to greater openness and opportunities for citizens to have a say.

Sold on false promises, we’ve lived the first NAFTA for 25 years. There never was a pot of gold waiting for our farmers and rural communities. It’s time to drop the free trade fairy tales and set a new path that lifts up farmers, workers and our communities.

Taken From: https://www.iatp.org/blog/201912/naftas-empty-promises

The New NAFTA Is a Raw Deal for Workers

Democrats and labor leaders are touting the renegotiated NAFTA deal as a win for workers and the planet. Don’t believe them: it’s a pro-corporate framework that will continue to bludgeon working people in Mexico, Canada, and the United States.

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NAFTA 4 EVER!

The Democratic Party and the AFL-CIO might as well put this on a T-shirt after their jubilant unveiling of the United States-Mexico-Canada Agreement (USMCA) this week. House Ways and Means Committee chair Richard E. Neal hailed the trade deal as “a triumph for workers everywhere.” AFL-CIO president Richard Trumka tweeted: “Working people have created a new standard for future trade negotiations.”

NAFTA 2.0 has the Republicans in good spirits as well, despite the impending presidential impeachment trial. Iowa senator Chuck Grassley said that while Republicans didn’t get everything they wanted in the new agreement, “the overall thing is very, very good. We may lose some Republicans . . . but it’s going to get through the United States Senate.”Have we finally fixed NAFTA?Well, from the perspective of mainstream politicians and big businesses, NAFTA 1.0 wasn’t broken — it was already a dream come true. Since 1994 manufacturers and agricultural companies have invested billions in production networks that stretch from Mexico to Canada, fine-tuned for maximum profitability. Trump’s campaign promise to blow the whole thing up in a bid to reduce the US-Mexico trade deficit and create jobs for workers in the United States created intense anxiety among investors and business owners, even after the three countries reached a tentative agreement last September.This week’s announcement triggered a sigh of relief across all three countries among politicians and most big corporations. Most but not all. Pharmaceutical companies are peeved that Democrats managed to jettison a clause granting drug manufacturers protection from generics on certain types of medicine. The Canadian dairy industry will face heightened competition as US farmers gain increased access. Mexican business’s only sweetener seems to be continued tariff-free access to the US domestic market.

More broadly, the investor-state dispute settlement mechanism was nixed, meaning companies have also lost the ability to sue countries for passing legislation (such as environmental restrictions or health and safety ordinances) that hurts their bottom line.

Nonetheless, experts say the USMCA is 90 percent NAFTA. The country-to-country dispute mechanisms that Canada desperately wanted to preserve remain in place. Neither Canada nor Mexico faces any dramatic new import quotas. And the United States hasn’t mandated job creation in sectors hit by NAFTA or domestic content restrictions that would spur additional US production.

Changes fall mostly in the range of neutral to friendly to corporations. US tech companies, for example, are happy about new language that “defends companies’ ability to move data freely across borders.” Digital marketplaces like Amazon will also benefit from a hike on de minimis levels in Canada and Mexico, which will make it cheaper for consumers in those countries to order goods online from the United States.

Overall, the twenty-five-year-old free-trade zone — which has afforded North American corporations unprecedented mobility and flexibility — has been preserved. So why are some hailing NAFTA 2.0 as a victory for working people? Short answer: our expectations have hit rock bottom, and the USMCA is slightly better than NAFTA for workers and the environment.

On the environment, the USMCA ends subsidies that contribute to overfishing; maintains the role for the Commission for Environmental Cooperation (an organization designed to promote public participation around conservation issues); and establishes a potentially wide scope for trilateral collaboration on conservation, pollution reduction, and sustainable development. Scrapping the investor-state dispute settlement machinery will also help on the environmental front by making pro-environment legislation less vulnerable to corporate attack. Bigger strides, however — such as aligning the USMCA with the Paris Accord — were apparently off the table.

As for workers’ rights, the main improvement is that Mexico has promised to implement new labor laws. The legislation — which Mexico’s Chamber of Deputies passed in April — establishes independent labor courts, adds new protections for union organizing drives, weakens company unions, and includes measures to protect workers from employer abuse and discrimination.

Per the USMCA, Mexico’s enforcement of these new rules will be subject to monitoring by an “inter-agency committee,” informed by watchdog “labor attachés.” If it appears Mexico isn’t following through on its end of the deal, “enforcement action” could kick in, though it’s unclear what that would look like. The idea is that boosting working conditions in Mexico will stop the “race to the bottom” in North America.

That’s certainly a laudable goal, and Mexico’s labor reforms probably wouldn’t have been passed without the threat of losing access to the US market. It must be said, however, that working conditions in Mexico have deteriorated as a direct result of NAFTA — US companies (as well as firms from Canada, Europe, and Asia) have facilitated and reproduced Mexico’s dreadful labor environment. If the lives of Mexican workers are to improve, corporations’ abusive relationships with their suppliers must also be addressed.

The second major improvement supporters are touting relates to changes in auto industry regulation. When Trump vowed to get rid of NAFTA, he bemoaned America’s trade deficit with Mexico, the vast majority of which comes from the automotive sector. He promised to renegotiate NAFTA to bring auto jobs and investment back to the United States.

The USMCA raises the North American content requirements for cars and parts from 62.5 percent to 75 percent and mandates that roughly 40 percent of vehicle contents originate in factories where workers are paid an average of $16 an hour (or risk a 2.5 percent tariff).

Unfortunately, these mandates are unlikely to boost auto jobs in the United States. As Sam Gindin explains:

Most of the assembly plants that operate under NAFTA (now USMCA) are close to the 75 percent target, and, though this may increase parts purchases in North America somewhat, it will not dramatically change industry employment numbers. Moreover, the additional content under this rule doesn’t have to be in the United States; it can locate in Mexico or Canada.

In addition, because North American supply chains are highly integrated, most of the vehicles coming from Mexico already meet the 40 percent requirement since many of their parts originated in the United States and Canada. And even if they don’t clear the new hurdle, it will be cheaper for the assemblers to pay the 2.5 percent penalty than hike wages in Mexico.

It’s not just auto. Despite this week’s intensive back-patting, the truth is that the manufacturing jobs that have been lost to both trade and technological advancements over the past few decades won’t be brought back by trickle-down trade agreements, whether with Mexico and Canada, China, or the European Union.

Small gains aside, the primary upshot of the Democrats’ and labor executives’ eagerness to take ownership of USMCA is to cement the status quo — to give their seal of approval to a pro-corporate framework that will continue to hurt working people in Mexico, Canada, and the United States.

Taken From: https://jacobinmag.com

Trump’s trade taxes add up to $7B in costs to Americans

American companies paid a record $7.2 billion in import taxes in October, or more than twice the average monthly amount before President Donald Trump began imposing tariffs on Chinese goods and foreign steel and aluminum in 2018.

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New figures from the Tariffs Hurt the Heartland campaign also show that Trump’s tariffs have slapped on $42 billion in added costs since they began.

“This trade war has lasted long enough and done enough damage,” said Jonathan Gold, a spokesperson for Americans for Free Trade. “It’s time the administration finalize a deal with China to end the trade war and remove all tariffs.”

When Digre’s father ran the company, it bought components from suppliers in the United States. But that production moved to China and other countries two decades ago, and chances appear slim of the jobs moving back.

“The center of the loudspeaker universe is in China now. So for us to be able to build products and be competitive, we have to buy parts from China,” Digre said. “That’s just the reality. There’s really nobody in the U.S. to buy this stuff from.”

Because of Trump’s tariffs, Misco is paying a 25 percent tax on the Chinese components it needs to make its speaker products. But in an odd twist, finished speakers face only a 15 percent tariff, so Trump has put Misco at a price disadvantage to companies that manufacture in China, Digre said.

In addition to increased tariff costs, Digre also faces unplanned expenses stemming from his search for a new supplier for the speaker components. “It takes a lot of time. You have to find the companies. You have to vet the companies. You have to get samples,” he said last week, before flying off to the Philippines to talk to companies there.

Trump has also imposed duties on steel, aluminum, washing machines and solar products from around the world, using different trade remedy laws. That has provoked trade retaliation from a number of trading partners, including China and the EU, on U.S. agricultural goods and other products.

Americans for Free Trade has teamed up with another group, Farmers for Free Trade, to back the Tariffs Hurt the Heartland campaign. Together, they worked over the past year to highlight the harm the duties are having on American businesses and farmers.

Both groups teamed up with The Trade Partnership, an economic research firm, to compile the latest data based on information published by the Commerce Department.

Duties aren’t just affecting imports but also take toll on U.S. exports, causing further losses for American firms. For the 12 months ending in October, exports of U.S. goods subject to retaliation fell 25 percent below their 2017 levels, said Dan Anthony, vice president of The Trade Partnership. That’s $30 billion in lost sales.

U.S. exports to Canada and Mexico also have not returned to pre-retaliation levels, even though Trump lifted his steel and aluminum tariffs on those countries this summer. That suggests there could be permanent economic losses even when tariff wars are over, Anthony said.

“This data shows that farmers in America’s heartland — the very places where the 2020 campaign will turn — are paying a steep price because of the trade war,” said Brian Kuehl, co-executive director of Farmers for Free Trade. “The president needs to show he can close not just a phase one deal, but a comprehensive deal that rolls back the tariffs and ends the trade war.”

Businesses in Florida, a key presidential swing state, have paid an additional $1.3 billion in taxes because of Trump’s tariffs, the latest data shows.

Companies in other states that could play a key role in Trump’s reelection or ouster are also facing increased tariffs: Michigan, $1.8 billion; Ohio, $1.5 billion; Pennsylvania, $1.2 billion; Wisconsin, $827 million; and Minnesota, $797 million.

Pro-business supporters of the president are acutely feeling the costs. Angela Carr, co-founder of Turbie Twist, a small business based outside Pittsburgh, said the duties are making her reconsider her decision to vote for Trump in 2016.

The company, which sells towels and headbands specializing in quickly drying hair after showers, worked hard to expand since it started in 2006. Its products are now in retail stores like Target, Walmart and CVS, and the company just celebrated 30 million units sold. Any added tariffs on consumer products are not easily passed on to customers.

“We’re not selling Rolexes to millionaires. These are hair towels,” Carr said. “They retail for $9.99, $19.99. Twenty-five percent [tariffs] to us is a huge number.”

Not only have the company’s Chinese suppliers refused to cut their prices in response to the tariffs, they tried to raise them. “We had to negotiate just to keep prices where they are,” Carr said.

“We’re a seven-person show,” Carr said. “We’re just two sisters selling hair towels. For us to pick up and move to Vietnam and qualify a factory, all of that thing, I mean the time and money wouldn’t even be worth it.”

Despite Trump’s anti-China rhetoric during the 2016 campaign, Carr said she assumed he would follow business-friendly policies once in office. But looking ahead to the 2020 election, the costs of his trade policies are making Carr question her allegiance to the Republican Party.

“It would break my heart to have to make a change, but this is my livelihood,” Carr said. “I have to make choices that are best for my family and the families of our team.”

Pelosi pushes to keep tech’s legal shield out of trade agreement with Mexico and Canada

House Speaker Nancy Pelosi, D-Calif., is pushing to keep a key legal shield for tech companies out of a new trade agreement with Mexico and Canada. The Wall Street Journal first reported the news on Thursday.

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The effort could throw a wrench into progress Congress seemed to be making on the pact and would be a blow to tech companies who already fear losing the legal protection within the U.S. Just last week, Pelosi said House Democrats were “within range” of reaching a pact they can support for the United States-Mexico-Canada Agreement, or USMCA, which would replace NAFTA.

Language in the proposed trade agreement echoes that of Section 230 of the Communications Decency Act, a hotly debated portion of the law that protects online platforms from liability for their users’ content. Having such language included in the agreement would be a boon for tech companies and would ensure certain legal protections for them abroad. But lawmakers have repeatedly questioned the wisdom of the law at home as disinformation spread freely on platforms such as Facebook, Twitter and Google’s YouTube leading up to the 2016 election and violent content has continued to crop up.

“There are concerns in the House about enshrining the increasingly controversial Section 230 liability shield in our trade agreements, particularly at a time when Congress is considering whether changes need to be made in U.S. law,” a spokesperson for Pelosi told CNBC.

On Twitter, Rep. Frank Pallone, D-N.J., said he agreed with Pelosi’s push to remove the legal protections from the agreement. Pallone is the chairman of the House Energy and Commerce Committee, which held a hearing on Section 230 in October where representatives from tech companies including Google and Reddit testified on the importance of the law for their businesses.

Pallone and the top Republican on the Energy and Commerce Committee, Rep. Greg Walden of Oregon, wrote a letter to U.S. Trade Representative Robert Lighthizer in August saying it was “inappropriate for the United States to export language mirroring Section 230 while such serious policy discussions are ongoing. For that reason, we do not believe any provision regarding intermediary liability protections of the type created by Article 19.17 are ripe for inclusion in any trade deal going forward. Given that our committee closely oversees Section 230 and all portions of the Telecommunications Act of 1996, we also hope in the future the Office of the United States Trade Representative will consult our Committee in advance of negotiating on these issues.”

But even after that letter, it’s unclear if Pelosi will receive support from her Republican colleagues on keeping such language out of the USMCA. A spokesperson for the Energy and Commerce Republicans said the letter to Lighthizer and Walden’s position are focused specifically on future trade deals, rather than ongoing ones such as the USMCA.

Fear of tying Congress’ hands

At the October hearing, Reddit CEO Steve Huffman testified that Section 230 gives his company the leeway to adapt “to meet new challenges” with their policies. Lawmakers at the hearing expressed support for a nuanced approach to any potential changes to the law, recognizing that it often allows tech platforms to remain nimble and take down negative content with impunity as well. Experts on the panel, like Boston University School of Law professor Danielle Citron, suggested tying the liability shield to companies’ demonstrating “reasonable” content moderation rather than giving it to tech companies for free.

Some lawmakers worried about the implication of including language from Section 230 in trade agreements, fearing that it would make the law harder to revise in the future.

“Trying to fit it into the regulatory structure of other countries at this time is inappropriate,” said Rep. Jan Schakowsky, D-Ill.

Gretchen Peters, executive director of the Alliance to Counter Crime Online, testified that including such language in trade agreements is “problematic because it potentially is going to tie Congress’ hands from reforming the bill down the line, and that’s precisely why industry is pushing to have it inside the trade deals.”

But Katherine Oyama, global head of intellectual property policy at Google, argued this isn’t the case.

“There’s no language in the trade deals that binds Congress’ hands,” Oyama testified to lawmakers. “There’s nothing in the current USMCA or the U.S.-Japan FTA that would limit your ability to later look at 230 and decide that it needs tweaks later on.”

Taken From: https://www.cnbc.com/2019/12/05/pelosi-pushes-to-keep-section-230-out-of-usmca-trade-agreement.html

New NAFTA deal improved, but still fundamentally flawed

“We have a long way to go before we get a deal that is ambitious enough to serve the needs of the planet and the rest of us.

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OTTAWA — After months of negotiations, a new NAFTA deal was reached between the U.S. Congress, Mexico and Canada. While the deal is still under wraps, it appears that some key positive changes have been made. However, the deal is more of the same, says the Council of Canadians.

“We have a long way to go before we get a deal that is ambitious enough to serve the needs of the planet and the rest of us. And with the climate crisis, we have so little time,” said Sujata Dey, Trade Campaigner for the Council of Canadians. “The changes to this deal show that while we are up against unprecedented corporate power, we are able to make a difference when we work together.”

Major changes to the deal include:

  • the removal of biologic drug provisions which lock-in profits for Big Pharma. (The Council of Canadians opposed this provision which could jeopardize a future Pharmacare program.)
  • more enforceable labour standards
  • the inclusion of more multilateral environmental agreements in the agreement.

The Council of Canadians welcomes these changes to the deal.

In addition, the Council advocated for removing the Investor State Dispute Settlement (ISDS) provisions which allow corporations to sue governments over public policy changes when they affect profit. The Council of Canadians also challenged the energy proportionality provisions which mandate Canada to export energy to the U.S. Both of those provisions have been removed for Canada in the deal.

“Thanks to people power, we have pushed for a better deal. However, it is still a deal based on a flawed pro-multinational blueprint. The deal empowers corporations and is ineffective at challenging the essential issues of our time—climate change and rampant inequality—which are amplified by unregulated globalization,” said Maude Barlow, Honorary Chairperson of the Council of Canadians. “What we can rejoice in is this: ISDS, the corporate courts are on the run. Chapter 11 will not apply to Canada in the new deal. Finally, all over the world, these provisions are being seen for what they are, an attack on the commons, and a grab bag for rich multinationals.”

At the same time, new toxic provisions were introduced into the new deal; a binding regulatory cooperation chapter which seats corporations at the table where regulations are made, giving them the power to modify and challenge them; the erosion of the supply managed markets and sovereignty for Canadian farmers; and ineffective protections for water. The agreement does not mention the Paris climate agreement and still has provisions which encourage the further privatization and deregulation of the economy.

The Council of Canadians is available to comment on the new NAFTA.

Taken from: https://canadians.org/media/new-nafta-deal-improved-still-fundamentally-flawed

Redo of USMCA Better Than Original NAFTA After Yearlong Effort to Improve Trump’s 2018 Deal

Unions, Consumer Groups and Congressional Democrats Achieve Removal of Big Pharma Giveaways and Strengthening of Labor, Environmental Standards and Enforcement

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WASHINGTON – Today, the administration and U.S. House Democrats announced they had reached an agreement on a redo of the U.S.-Mexico-Canada Agreement (USMCA) that Donald Trump signed last year. Lori Wallach, director of Public Citizen’s Global Trade Watch, issued the following preliminary statement about the revised revised North American Free Trade Agreement (NAFTA):

Thanks to congressional Democrats, unions and consumer groups fighting to remove Big Pharma giveaways and improve labor and environmental terms, the redo of Trump’s 2018 NAFTA 2.0 is better than the original NAFTA and could improve peoples’ lives, although it still includes problematic terms.

Trump failed to fix NAFTA with the deal he signed last year, betraying his promise to working people. It included new Big Pharma giveaways that lock in high drug prices and labor and environmental terms that were too weak to stop NAFTA’s original sin of job outsourcing.

Working people are the winners in the yearlong battle to force Trump to fix his NAFTA 2.0: The changes Trump was forced to make mean the final deal could counter some of NAFTA’s ongoing damage to working people and the environment. Although many NAFTA flaws were not fixed, the alternative is status quo NAFTA, not a more improved deal.

The best feature of the new NAFTA is the gutting of Investor-State Dispute Settlement (ISDS). Using this regime, corporations have extracted almost $400 million from North American taxpayers after attacks on environmental and health policies before tribunals of three corporate lawyers. That a U.S. pact largely eliminates extreme ISDS protections for foreign investors and anti-democratic tribunals sends a signal worldwide about the illegitimacy of the ISDS regime.

Trump’s claim that this new NAFTA will bring back hundreds of thousands of manufacturing jobs is absurd. However, over time, the labor and environmental standards and enhanced enforcement terms may help raise wages in Mexico, and this may also reduce U.S. corporations’ incentives to outsource U.S. jobs to Mexico to pay workers less.

Today’s deal shows that to be politically viable, trade pacts can no longer include extreme corporate rights like ISDS or new monopoly protections for Big Pharma that have been featured in past U.S. trade deals and that they must have enforceable labor and environmental standards. This is a significant shift after decades of U.S. trade pacts expanding corporate rights and Big Pharma monopoly protections.

Fixing the existing, damaging NAFTA is not the same as negotiating a truly progressive trade agreement from scratch, which would additionally require climate provisions, truly enforceable currency disciplines, and the elimination of limits on consumer protections for food, product safety, the service sector and online platforms. The new NAFTA is not the template for future agreements, but establishes the floor from which we will continue to advocate for a new model of trade and globalization that puts people and the planet first.

Taken From: https://www.commondreams.org/newswire/2019/12/10/redo-usmca-better-original-nafta-after-yearlong-effort-improve-trumps-2018-deal

Mexico accepts U.S. steel demand in USMCA trade deal, but with conditions

MEXICO CITY (Reuters) – Mexico would accept a U.S. demand on steel in the United States-Mexico-Canada Agreement if the rule took effect at least five years after the trade pact’s ratification, Mexican Foreign Minister Marcelo Ebrard said on Sunday.

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Mexican lawmakers earlier this year approved the deal, known as USMCA, which would replace the North American Free Trade Agreement. But Democratic lawmakers have held up U.S. ratification over concerns about how labor and environmental provisions would be enforced.

U.S. Trade Representative Robert Lighthizer also made a last-minute demand to restrict the definition of what would constitute North American steel and aluminum under automotive rules of origin, calling for the metals to be “melted and poured” only in North America.

“Mexico has shared that this would bring lots of problems,” Ebrard told reporters, adding that Jesus Seade, Mexico’s top negotiator for USMCA, would travel to Washington within hours to present Mexico’s terms.

“We will tell (the United States) that we will not accept, in any form, for this obligation to take effect the moment the treaty is ratified,” Ebrard said.

Mexico would allow the rule for steel to be enforced after at least five years but not accept the tighter rule for aluminum because the country does not produce the metal’s raw materials, Ebrard said.

U.S. negotiators had also pushed Mexico to impose tougher controls on its labor standards, including allowing U.S. inspectors to supervise their implementation in Mexico.

Ebrard reiterated the Mexican government’s rejection of that proposal, but said Mexico would allow panels composed of experts and a third party to review labor standards.

The USMCA, signed about a year ago, must be passed by lawmakers in all three countries, including the U.S. Congress.

Canada has said it is waiting on ratification in order to move in tandem with the United States.

Taken From: https://www.reuters.com/article/us-usa-trade-mexico-idUSKBN1YC0NA