New NAFTA must help workers, family farms, environment

Arthur Stamoulis, Citizens Trade Campaign

As talks begin in renegotiating NAFTA (North American Free Trade Agreement), it is undeniable that the trade pact has been a disaster for working people, communities and the environment in the United States, Mexico and Canada.

For more than two decades, the deal has prioritized corporate profits while offshoring jobs, eroding working-class wages, displacing family farmers, fueling forced migration, increasing medicine costs, rendering food unsafe, polluting our air and water and destabilizing our climate.

It is long past time for NAFTA to be replaced. Unfortunately, without much stronger public accountability, NAFTA’s current renegotiation could easily become an extension of the Trans-Pacific Partnership (TPP) corporate power grab that millions of Americans and others around the world opposed, rather than fix the problems that have devastated so many people in the first place.

Needed changes

To create good-paying jobs and eliminate threats to our communities, NAFTA must be replaced with an agreement that includes these essential changes:

  • Eliminate rules that encourage the offshoring of jobs and that empower corporations to attack democratic policies in unaccountable tribunals. NAFTA was the first U.S. trade agreement to include special privileges for investors in the form of Investor-State Dispute Settlement (ISDS) that make it less risky for employers to relocate jobs offshore, while simultaneously threatening democratic policymaking at home and abroad. ISDS granted new rights to multinational corporations to sue governments for unlimited sums of money before panels of corporate lawyers. Already, corporations have used ISDS to challenge bans on toxic chemicals, land-use policies, forestry and water policies, financial regulation, court rulings that support access to medicine and protections for our climate. As of March 2017, more than $440 million had already been paid out to corporations in ISDS cases under U.S. trade agreements, and more than $70 billion in claims were still pending.
  • Defend jobs and human rights by adding strong, binding and enforceable labor and environmental standards to the agreement’s core text and requiring that they are enforced. NAFTA facilitated a race to the bottom by creating incentives for corporations to offshore jobs to wherever they could exploit the lowest labor and environmental standards. The White House’s current plan for renegotiating NAFTA relies on the same weak and ineffective standards found in past trade agreements.
  • Overhaul NAFTA rules that harm family farmers and feed a destructive agribusiness model. NAFTA devastated rural communities in the United States and Canada, while also pushing millions of Mexican farmers and farmworkers off their land, fueling a major increase in forced migration. NAFTA’s agriculture terms must be changed to achieve balanced trade that supports fair and sustainable food supplies and rural economies.
  • End NAFTA rules that threaten the safety of our food. NAFTA has enabled a flood of food imports that has overwhelmed food safety inspectors, contributing to a rise in foodborne illnesses. NAFTA must require imported food to meet domestic food safety standards, include enhanced border inspection requirements and it must require country-of-origin labeling for meat so that consumers can make informed choices.
  • Eliminate NAFTA rules that drive up the cost of medicines. NAFTA prioritizes drug companies over patients by establishing monopoly protections that shield pharmaceutical firms from competition and increase medicine prices. To increase access to affordable medicines, NAFTA’s existing intellectual property protections must be eliminated.
  • Eliminate NAFTA rules that undermine job-creating programs like Buy American. NAFTA bars each participating government from prioritizing purchases of domestically made products over those made in other NAFTA countries. These types of rules could also threaten environmentally-friendly purchasing policies and prevailing wage and other labor requirements. Governments must be allowed to use taxpayer funds to meet domestic economic stimulus, development and social goals.
  • Add strong, enforceable disciplines against currency manipulation to ensure a fair playing field for job creation. NAFTA allows countries to lower the value of their currencies to gain trade advantages. Penalties for currency manipulation must be included in trade agreements’ core texts, and domestic U.S. legislation must be enacted that triggers automatic corrective action against currency manipulators, rather than simply triggering reports or dialogue.
  • Require imported goods and services to meet domestic safety and environmental rules. As with imported food, NAFTA requires countries to allow imports of other products that do not meet domestic safety and environmental standards. This includes energy, financial and other services that do not meet American standards.
  • Add a broad protection for environmental, health, labor and other public interest policies. NAFTA takes away American sovereignty. Other governments, and even individual corporations, can challenge laws that were democratically passed by Congress, state legislatures and city councils as NAFTA violations outside the U.S. judicial system.

Transparent and participatory

This is only a partial list of needed changes to NAFTA — many others could be added. But a NAFTA renegotiation that does not include these changes would certainly not work for working people.

To achieve such an overhaul, the NAFTA renegotiation process must be transparent and participatory — the complete opposite of the opaque and corporate-dominated negotiations that produced NAFTA and the TPP. During the renegotiation, the public must be invited to help formulate U.S. positions and comment on draft U.S. proposals. Negotiated texts also must be made publicly available, with opportunity for comment, after each negotiating round.

We must work together to make sure NAFTA is renegotiated right. Without being aggressive watchdogs, corporations seeking to add TPP-style provisions into NAFTA could make the pact even worse for working families in all three countries.

Arthur Stamoulis is Executive Director for the Citizens Trade Campaign.