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Lessons from NAFTA Should Stop Bad Korea Trade Deal

 

by James Parks, Feb 28, 2007

The North American Free Trade Agreement (NAFTA) has been a disaster, failing workers in Mexico, Canada and the United States. Yet the Bush administration continues to use the same flawed model to negotiate its trade deals, including the proposed deal with South Korea. Known as KORUS, the pact with South Korea could be the largest U.S. trade agreement since NAFTA took effect Jan. 1, 1994. Korean Confederation of Trade Unions (KCTU) Vice President Heo Young-koo told a Capitol Hill briefing Tuesday that KORUS in its present form will significantly hurt U.S. and Korean workers, just as NAFTA hurt workers in North America.

Heo says the Korean government negotiated the deal out of public view—and like NAFTA, the proposed Korea-U.S. pact does not protect workers’ rights. Without such protections, Korea will continue its current policies of repressing workers. As recently as last month, 62 Korean union members, including Heo, were imprisoned for union activities, he says. In fact, when it comes to enforcing internationally accepted workers’ rights, South Korea ranks lower than Colombia—where more trade union members are killed than any other country—according to the United Nations’ International Labor Organization.The Bush administration is pushing hard to complete negotiations on KORUS before its “Fast Track” authority expires. Fast Track, also known as trade promotion authority, was narrowly passed by the Republican Congress in 2002. The law allows the president to negotiate trade deals but prevents Congress from improving or rejecting harmful provisions by allowing only “yes” or “no” votes on such trade packages.

Working families strongly opposed the 2002 legislation and the AFL-CIO union movement recently has joined in coalition with other fair trade activists to battle against unfair trade deals, including trade promotion authority. The White House would have to submit a completed deal with Korea by March 31 to have it considered under Fast Track. With Democrats leading Congress, it is unclear whether Fast Track will be renewed in its current form.

Opposition to Fast Track also is building across the country. David Sirota reports that the Montana state Senate on Tuesday overwhelmingly sent a message to its members of Congress by passing a resolution calling on Congress to not renew Fast Track. Sen. Max Baucus (D-Mont.) chairs the Senate Finance Committee, which has jurisdiction over Fast Track legislation. In the past, Baucus has supported Fast Track.

The Montana resolution’s sponsors say Fast Track-enabled trade deals limit opportunity for workers and state legislatures’ ability to govern. Under these Fast Track-enabled trade policies, Montana’s and other states’ ability to create and enact their own laws is in jeopardy due to overreaching trade agreements that incorporate rules that have little to do with trade.

Earlier this month, some 100 workers from the United States and Korea demonstrated in Washington, D.C., where the trade negotiations were being held. The action was the latest in a series of protests, from Seattle to Seoul, involving U.S. and South Korean trade unionists and allies against yet another bad trade deal skewed in favor of Big Business at the expense of workers.

Rep. Betty Sutton (D-Ohio), who hosted yesterday’s congressional briefing, says

We were promised good things would come from NAFTA, but look at what happened. We cannot enter any more trade agreements with the flawed NAFTA model.

According to a study by the Economic Policy Institute (EPI), NAFTA failed workers in Mexico, Canada and the United States. The report’s co-authors told the briefing:

  • In each nation, while workers’ productivity grew, workers’ salaries remained stagnant or dropped and the wealth of those at the top increased significantly.
  • More than 1 million jobs that would have been created were lost in the United States, says EPI economist Robert Scott.
  • In Mexico, many of the new jobs that were created were low-wage with no benefits and no future, says Carlos Salas, professor at Mexico’s El Colegio de Tlaxcala and Institute of Labor Studies.
  • In Canada, the United States’s largest trading partner, wages stagnated and inequality increased, says Bruce Campbell, executive director of the think tank Canadian Center for Policy Alternatives.

EPI economist and author Jeff Faux, who wrote the introduction to the study, says the issue is not trade:

The issue is what the rules are. The rules that we have been setting gives global companies the advantage and cuts the bargaining power of workers.

 

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