Lawmakers, unions campaign against secret trade court in ‘new NAFTA’
A key draw for foreign assembly plants and investment has been Mexico's low wages. With many workers unable to afford the vehicles Mexico produces, the country exports about three times as many cars as are purchased domestically, most to the United States. | Ben Margot / AP

WASHINGTON—Progressive House Democrats and their union allies campaigned against retaining a secret “trade court” in any “new NAFTA.” At an outdoor press conference, they also delivered petitions, including those collected by the Communications Workers and the AFL-CIO, with thousands of signatures on them to fellow lawmakers.

And they may be getting somewhere. A top trade specialist who was privy to nations’ stands in talks for the now-dead Trans-Pacific Partnership, said in an informal conversation afterwards that the Trump administration’s top bargainer, Trade Representative Robert Lighthizer, is dead set against the current “trade court,” called the Investor-State Dispute System (ISDS).

“He views it as a violation of U.S. sovereignty,” she added. The fallback position, she said, is that if there is to be an ISDS, damages firms could get from such a secret court would be limited to actual past losses, not losses of expected future profits. The fallback would also mandate the three nations in the talks – Canada, the U.S., and Mexico – would have to opt-in to letting the secret trade court decide cases.

The Democrats marshaled their forces as the NAFTA talks resumed across the Potomac River in the D.C. suburb of Alexandria, Va., and as news reports indicate they may break down over the GOP Trump administration’s demands for higher U.S. domestic content in cars, among other issues. That stand alarmed big business, according to a Chamber of Commerce statement.

President Donald Trump and Canadian Prime Minister Justin Trudeau walk along the Colonnade to the Oval Office of the White House in Washington, Oct. 11. | Carolyn Kaster / AP

On worker rights, the Democrats and unions have the support of the Canadian government, as Prime Minister Justin Trudeau devoted most of his October 11 morning meeting with President Donald Trump to NAFTA.

Trudeau’s government, agreeing with Canada’s largest union, previously put the issue of worker rights in the U.S. – specifically repeal of so-called “right-to-work” laws – on the NAFTA bargaining table. The third nation in the talks, Mexico, is holding out against both of the others on worker rights.

“We’re here to announce the delivery of petitions with 400,000 signatures from Americans demanding that any trade agreement eliminate rules that let businesses outsource jobs,” said Rep. Rosa DeLauro, D-Conn., a veteran lawmaker known for her ability to marshal colleagues’ votes.

“And the ISDS rules empower secret panels of three corporate lawyers” sitting as the judges in that “trade court,” “who can demand unlimited sums of American taxpayer dollars,” when firms are allegedly injured by trade restrictions. And there’s no appeal, either, DeLauro added. Rep. Jan Schakowsky, D-Ill., called the secret trade panels “kangaroo courts.”

“We’re here to support people before corporations – workers, and jobs in the U.S. that pay a living wage,” said Rep. Marcy Kaptur, D-Ohio. Just in the first year after NAFTA took effect in 1994, GM closed a plant in her northern Ohio district, costing 14,000 jobs, by moving the work to Mexico.

“If the current occupant of the White House,” Trump, “wants to show that ‘I’ll renegotiate NAFTA,’ is more than a campaign slogan, then there has to be no ISDS,” declared Rep. Keith Ellison, DFL-Minn.

The Voice of America reported cars and parts may be the big NAFTA stumbling block. NAFTA requires at least 62 percent of a car’s parts to be made in North America before the car can avoid import tariffs and taxes. Trump wants it to be 85 percent, including 50 percent from the U.S. The Chamber of Commerce called that a “poison pill” in the NAFTA talks.

That didn’t dismay Reps. Debbie Dingell and Dan Kildee, both D-Mich., and both with car and part plants, though not as many as once loomed there.

“Our factories are empty,” Dingell said. “We need to talk about labor costs and how wages are much cheaper in Mexico.” Added Kildee, “We used to have 79,000 jobs in Flint,” his hometown, making auto parts. “Now we have just over 10,000” due to migration of parts plants to Mexico. Raising Mexican wages is one U.S. negotiating objective, a U.S. Trade Rep’s fact sheet says, along with eliminating the ISDS.

Despite labor’s campaign on trade pacts’ negative impact in general and the ISDS in particular, Ellison said most people don’t know about it. “It undermines the voters who elect representatives to make laws which affect them. It undermines democracy and sovereignty. We’ve gotta make people know what the ISDS is.”


Mark Gruenberg
Mark Gruenberg

Mark Gruenberg is head of the Washington, D.C., bureau of People's World. He is also the editor of Press Associates Inc. (PAI), a union news service in Washington, D.C. that he has headed since 1999. Previously, he worked as Washington correspondent for the Ottaway News Service, as Port Jervis bureau chief for the Middletown, NY Times Herald Record, and as a researcher and writer for Congressional Quarterly. Mark obtained his BA in public policy from the University of Chicago and worked as the University of Chicago correspondent for the Chicago Daily News.