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Trump Re-Opens NAFTA, Activists Fear It Is The TPP In Disguise

Like a steady drumbeat, candidate for President, Donald Trump, said he would “renegotiate NAFTA,” the North American Free Trade Agreement that has cost millions of American jobs.   As talks begin this week to make changes to NAFTA some fear that this “new NAFTA” will just be another “grab bag of corporate handouts.”

“NAFTA was a radical experiment,” said Lori Wallach, Director of Public Citizen’s Global Trade Watch. “NAFTA subsidized offshoring, making it easier for corporations to move American jobs overseas.”

Working people across the country blamed NAFTA for destroying our manufacturing base. “910,000 jobs have been lost due to NAFTA and we have seen our trade surplus with Canada and Mexico shift to a trade deficit,” Wallach added.

“NAFTA went far beyond what we think of as trade,” said Ben Beachy of the Sierra Club. “NAFTA is a grab bag of corporate handouts.”

Beachy explained how this new NAFTA negotiations are being conducted in the same way the Trans-Pacific Partnership was conducted, in complete secret by corporations. There are no representatives for labor or the environment allowed to be a part of the negotiations.

The Sierra Club has been fighting the harmful pollution policies laid out in NAFTA. Due to weak environmental protections in Mexico, NAFTA allowed corporations to export their hazardous waste. The number of toxic waste facilities in Mexico, owned by foreign corporations, grew by over 40% in the last 25 years.

“Underweight babies are being born with elevated levels of lead in their blood because of led battery exports,” said Beachy.

The Sierra Club also opposed the Trans-Pacific Partnership’s poor environmental protections and fears that Trump’s new NAFTA will fail to raise environmental protections.

When a country does try to fight back against these corporations they take their case to the Investor-State Dispute Settlement (ISDS). The ISDS has been incorporated into more than 3,000 trade agreements worldwide 50 of which the United States is included in.

The ISDS is a corporate court, where three corporate lawyers decide the outcome of the dispute. Murshed Zaheed, the Executive Director of Credo Mobile said, “The ISDS puts corporations over people.”

If the corporation wins their case in the ISDS, the taxpayers of the State (i.e. the country being challenged) are forced to pay for the “damages.” The United States alone has already paid out over $400 million in ISDS disputes.

“The ISDS circumvents American sovereignty,” said Rep Keith Ellison (D-MN). He explained who Phillip Reynolds won their ISDS dispute with the country of Uruguay over the labeling of their cigarettes. Uruguay wanted to put a warning label on all cigarette packages, however they were shut down by the ISDS.

(Watch this video from Credo Mobile featuring Senator Elizabeth Warren, explain how the ISDS works in her opposition to the TPP.)

 

The prior history of NAFTA is well known. It crushed our manufacturing and cost millions of people their jobs. But every story has two sides.

Erika Andiola, an immigration activist and a director in Our Revolution, talked about how NAFTA “decimated the Mexican economy” which forced a massive Mexican migration

“Local farmers lost their farms due to the influx of cheap American corn,” Andiola said. After they lost their farms, these farmers were forced to move into the cities to find work. “The economy shifted as local shops and markets were replaced with Wal-Mart and Costco.”

Ultimately, when they could not find work in Mexico, some headed north to the United States in search of work.

Andiola added, “We must talk to our members of Congress to ensure that NAFTA will help American workers but raise the living standards for the workers in ALL countries.“

Yesterday, the Trump administration began the first round on negotiation on NAFTA. Beachy said, “Trump wants to begin by copying the Labor and Environmental protections from the TPP into the new NAFTA.”

We beat the Trans-Pacific Partnership and if we use our collective voices we can make our demands for a better NAFTA heard.

“As renegotiations begin today, there is an incredible opportunity to replace this fundamentally flawed trade deal with new rules that work for working families,” said AFL-CIO President, Richard Trumka in a statement. “But how we do it matters. The administration can choose to use this opportunity to benefit working families, or it can further rig the rules to favor corporations and CEOs.”

Rep Ellison said “we must demand”:

  • No ISDS
  • Labor standards are lifted instead of dropped.
  • Environmental standards are lifted instead of dropped.
  • Food standards are lifted instead of dropped.

“We are setting the bar high. We will only accept a deal that is renegotiated the right way. That means having a transparent process in which working families have a seat at the table, and ensuring that our freedom to stand together is protected and that all of us can receive a fair return on our hard work. We need to replace benefits for the few with a fair deal that raises wages, stops outsourcing and provides a path to the middle class, no matter where working families live or what their background is. America’s working people have earned this. We deserve nothing less,” Trumka concluded.


This story compiled from speeches by Rep Keith Ellison, Lori Wallach, Murshed Zaheed, Ben Beachy, and Erika Andiola at Netroots Nation 2017.

Full video of panel here or below.

Leo W Gerard: Workers Need Better Trade Deals, Not More Talk

President Donald Trump, author of “The Art of the Deal,” said this week that China is giving American workers and companies a crummy one. He promised to do something about it.

This occurred within days of his Commerce Secretary, Wilbur Ross, demanding “fair, free and reciprocal” trade in an op-ed in the Wall Street Journal.

At the same time, Congressional Democrats offered a seven-point plan to give workers what they called “A Better Deal on Trade and Jobs.”

American workers want all of these proposals achieved. They’ve heard this stuff before and supported it then.  That includes ending tax breaks for corporations that offshore jobs – something that never happened. It includes the promise to confront China over its steel and aluminum overcapacity – a pledge followed by delay. Talk is cheap. Jobs are not. The factory anchoring a community’s tax base is not. America’s industrial strength in times of uncertainty is not. All the talk is useless unless workers get some action.

President Trump is expected to announce within days the launch of an investigation into China forcing American corporations to transfer technology to the Asian giant’s companies as a price of doing business there. The technology transfer boosts China’s goal of becoming the leading manufacturer within a decade in high-tech areas such as semiconductors, robots, and artificial intelligence. In addition to seizing American research and know-how, Beijing advantages its technology companies by granting them government cash.

This is the kind of unfair competition that Secretary Ross talks about in his Wall Street Journal op-ed.Under so-called free trade rules, governments aren’t supposed to subsidize industry or demand that foreign investors fork over research.

These kinds of violations, not just with China but with other trading partners as well, have occurred for decades now. And the upshot for American workers is lost jobs and stagnant wages.

More than 5 million American manufacturing jobs disappeared between 1997 and 2014. Most of these vanished, according to the Economic Policy Institute (EPI), because of growing U.S. trade deficits with countries like Mexico and China that had negotiated trade and investment deals with the United States.

The United States’ massive trade deficit with China alone accounted for 3.4 million jobs lost between 2001 and 2015, with 2.6 million of those in manufacturing, according to EPI research.

While offshoring manufacturing has often padded corporate profits, it has suppressed wages in the United States and in trading partner countries like Mexico. United Technologies (UT) is a good example.

UT moved to Mexico this year its Electronic Controls unit, which manufactures microprocessors for heating, ventilation and air conditioning (HVAC) equipment. UT did this even though its 700 American workers had produced consistent profits for UT at a factory in Huntington, Ind. UT also moved a big chunk of its profitable Carrier HVAC manufacturing from Indianapolis to Mexico this year. UT’s stock price rose, so the already-rich who have cash to invest, made out.

They did it on the backs of workers in the United States and Mexico, however. The move to Mexico rendered jobless more than 1,000 skilled American workers. Studies show that if they’re lucky enough to land new employment, the pay will be substantially less.

Mexican workers gained the jobs, but the pay they’re getting is little better than before NAFTA. More than half of Mexicans still live below the poverty line, a figure no different than before NAFTA. The New York Times cited this case: “For 10 years, Jorge Augustín Martínez has driven a forklift for Prolec, a joint venture with General Electric that makes transformers. A father of two, he earns about $100 for a six-day workweek.”

Mexican wages have remained stagnant for a decade.

In the United States, wages have been flat for longer – several decades.

This as corporate profits rise, the stock market skyrockets and CEO pay surges limitlessly.

Trade deals worked great for the already-rich, CEOs and corporations. They’ve crushed workers.

So it’s encouraging that both President Trump and the Democrats are talking about solutions.

The president is right. American corporations shouldn’t have to transfer technology to China to operate there. The United States doesn’t require that of Chinese companies manufacturing here. No such demand was made of Foxconn when it agreed to build a $10 billion factory in Wisconsin last week – though it is true that Wisconsin Republicans plan to force the state’s taxpayers to contribute $3 billion toward the plant, nearly a third of the total cost.

And the Democrats are right about every point in their “Better Deal” plan. Workers need an independent trade cop they can turn to for quick results to combat trade violations before they cost Americans jobs. Corporations like UT and Rexnord should be penalized when they offshore and when they seek government contracts. Corporations that restore jobs to the United States should be rewarded.

So do it. And don’t procrastinate like the administration is doing on its investigation of the national security threat posed to the United States by steel and aluminum overproduction in China. The report in that case originally promised for June 30 now has been indefinitely delayed. Each day’s wait means more American workers without jobs as illegally subsidized, grossly underpriced Chinese steel and aluminum floods the international market.

America’s highly skilled, dedicated steel and aluminum workers perform their jobs faithfully every day with the expectation that their government will enforce international trade regulations. They also expect their government to support their right to join together and collectively bargain for better wages and benefits. As right-wingers have eroded workers’ bargaining rights over the past half century, unions have declined, and with them, workers’ ability to secure raises. This is true in Mexico too, where there are virtually no legitimate, worker-run unions.

Timothy A. Wise, a research fellow at Tufts University, put it this way to the New York Times: “Mexico is seeing exactly the same phenomenon as in the United States. Workers have declining bargaining power on both sides of the border.”

To ensure there are no more crummy trade deals, workers must be at the table when these pacts are negotiated. To get better wages, workers in all the countries involved in these deals – from China to Mexico to the United States – must be able to form real, worker-controlled labor organizations to bargain with corporations.

Praise And Concern Over Democrats “Better Deal”

Communication Workers of America: Working People Need Protections for U.S. Call Center Jobs and a “Better Deal”

Today the Democrats released the details of their “Better Deal” that will focus on three goals:

Raise the wages and incomes of American workers and create millions of good-paying jobs: Our plan for A Better Deal starts by creating millions of good-paying, full-time jobs by directly investing in our crumbling infrastructure and prioritizing small business and entrepreneurs, instead of giving tax breaks to special interests. We will aggressively crack down on unfair foreign trade and fight back against corporations that outsource American jobs.  We will fight to ensure a living wage for all Americans and keep our promise to millions of workers who earned a pension, Social Security and Medicare, so seniors can retire with dignity.

Lower the costs of living for families: We will offer A Better Deal that will lower the crippling cost of prescription drugs and the cost of a college or technical education that leads to a good job. We will fight for families struggling with high monthly bills like childcare, credit card fees, and cable bills. We will crack down on monopolies and the concentration of economic power that has led to higher prices for consumers, workers, and small business – and make sure Wall Street never endangers Main Street again.

Build an economy that gives working Americans the tools to succeed in the 21st Century: Americans deserve the chance to get the skills, tools, and knowledge to find a good-paying job or to move up in their career to earn a better living. We will commit to A Better Deal that provides new tax incentives to employers that invest in workforce training and education and make sure the rules of the economy support companies that focus on long-term growth, rather than short-term profits. We will make it a national priority to bring high-speed Internet to every corner of America and offer an apprenticeship to millions of new workers. We will encourage innovation, invest in advanced research and ensure start-ups and small business can compete and prosper.

(Video of Better Jobs announcement at bottom of post)

Richard Trumka, President of the AFL-CIO praised today’s announcement.

“We applaud Sen. Chuck Schumer’s leadership and the Senate Democrats for committing to better trade deals and creating the good jobs that working people deserve. Particularly notable in this agenda are the demands for increased public input and transparency in trade negotiations—including the call for town hall meetings across the country—as well as the continued commitment to long-needed action on currency and trade enforcement. This blueprint provides a good start but also must ensure that working people across North America are free to join together to negotiate a fair return on our work. We look forward to working with the Senate to replace the North American Free Trade Agreement’s corporate-driven rules and enact other innovative trade reforms beneficial to working families.”

After the details of the Democratic Party’s “better deal” were released the Communications Workers of America issued a statement highlighting the need to protect call center jobs from offshoring.  

The Democratic Party’s plan for a better deal on trade and jobs outlines real policies to help working families fight back against corporations that want to shift more jobs overseas and cut wages and benefits for working Americans.

For the first time, lawmakers are recognizing the impact of the tens of thousands of U.S. customer service jobs that have disappeared over past years, as corporations ship good call center jobs to Mexico, India, the Philippines and other countries.

CWA has been pressing Congress to stop this flood of jobs overseas. Corporations are boosting their profits and enriching their investors at the expense of working Americans, and communities are devastated when these good service jobs disappear. And as more jobs are sent offshore, more pressure is brought to bear on U.S. workers to accept lower wages and benefits as the price for keeping any job at all.

The Democratic “Better Deal” plan includes crucial legislation introduced by Senator Bob Casey (D-Pa.) that would help restrict call center offshoring and reverse the loss of thousands of good customer service jobs in the U.S.  It also would provide important consumer safeguards.

Overall, the “Better Deal” plan will give working people a long overdue voice in what happens to their jobs and their communities. It ends the tax incentives and other rewards that corporations now get for sending  jobs overseas; encourages companies to bring jobs back to the U.S. with financial incentives; fully restores “Buy America” requirements for all taxpayer-funded projects, and makes improving U.S. wages and good jobs a key objective of our trade policy.

The Better Deal plan would require companies that handle sensitive U.S. consumer data abroad, including call centers, to disclose to customers what country they are physically located in and the level of data protection in that country.

U.S. trade deals should benefit working families, consumers and communities, not just investors and big corporations. The Better Deal plan provides real solutions to do just that.

Leo W Gerard: Don’t Dawdle on Economic and National Security

The future of the American steel and aluminum industries is not a matter for dithering.

Steel worker takes a sample from oven

Each mill and smelter that remains operating is too vital. Each is too crucial to the economic viability of a corporation, a community, and thousands of workers and their families. Each also is too essential to national security, which relies on American-produced metals for critical infrastructure, from bridge construction to the electrical grid, and for munitions, from fighter jets to bullet-proof vests.

There is no more time for waiting. International trade law must be enforced now. Throughout his campaign, Donald Trump pledged his support to workers and these industries. And he followed through by launching within three months of taking office as president special investigations into the effects of steel and aluminum imports on national security. Such inquiries may take as long as a year to conclude, but the administration expedited the process. Until it didn’t. Now steel and aluminum corporations, their communities and their workers are being told to wait. It’s a delay that could kill more American mills and smelters.

The nation lost nine aluminum smelters over the past six years, leaving only five in the entire country, and most of them are now operating at reduced levels. Beginning in January 2015, steel companies laid off 14,000 workers as they closed mills and sections of mills. For example, Allegheny Technologies shuttered a plant that made grain oriented electrical steel in 2016, leaving only one U.S. company, AK Steel, now producing this component critical to electricity transmission.

As mills and smelters disappear, the military is further restricted in its ability to secure domestically produced essential metals in time of crisis.

The primary culprit in this scary scenario is overcapacity and overproduction in China, which overwhelms the world market with illegally subsidized, grossly underpriced aluminum and steel.

China has promised repeatedly to solve this problem. On Thursday it pledged again, this time contending it wanted to work globally to deal with the issue of aluminum overcapacity – a problem Beijing created. Over the past six years, using massive government subsidies, China quickly ramped up capacity to become the largest aluminum producer in the world.

China can’t be trusted on this because it never keeps its promises. It has never cut its steelmaking capacity after announcing again and again that it would. In negotiations last week, Trump cabinet members could not even get a specific commitment out of China to do it. There’s no evidence China will stop overproducing steel or aluminum now. Waiting is useless. And destructive to American manufacturing.

The American steel and aluminum industries have fought back, filing and winning dozens of trade cases against imports of specific products. But the resulting tariffs and other penalties imposed by the U.S. Commerce Department and U.S. International Trade Commission (ITC) didn’t solve the problem. Instead of paying U.S. tariffs, China shipped its government-supported excess of these products to other countries, artificially suppressing world prices and warping what is supposed to be a free market.

Also, this traditional process for seeking relief from unfair trade takes too long. More than a year may elapse before companies and workers get a final decision. And that will be for just one product, like aluminum extrusions, aluminum foil, welded stainless steel pressure pipe or corrosion-resistant steel, to name a tiny number of cases from recent years.

That’s part of what made the special investigations into steel and aluminum imports so attractive. If the U.S. Commerce Department determined under Section 232 of the Trade Expansion Act of 1962 that imports of steel and aluminum jeopardized national security, then the president could impose penalties broadly to ensure the country could meet its own needs. The effort might also spur allies to join the United States in finally pressuring China sufficiently to actually reduce capacity.

Although Section 232 allows for nine months of investigation, after which the President would have three months to determine a remedy, the administration promised quick action when it announced the inquiries in April. The steel report was to be completed by June 30, with a speedy decision by the president after that.

That suggested the administration understood this was urgent.

But June 30 came and went. Now there’s an official delay. The administration told the Wall Street Journal that the steel investigation is on hold until after health care reform, tax changes and infrastructure spending are accomplished.  “We don’t want to do it at this moment,” the president said Tuesday of the steel case.

That’s devastating. Especially because steel imports have jumped 22 percent since Jan. 1, placing additional pressure on the American industry.

The delay occurs as efforts are made by a new company to reopen at least one potline at an aluminum smelter in New Madrid, Mo., that the now-bankrupt Noranda company idled last year. Postponing the Section 232 decision makes for uncertainty for these investors.

It also occurs as a Chinese company is trying to buy Aleris, an Ohio-based manufacturer that supplies aluminum for use in vital infrastructure and military applications. That Asian firm, China Zhongwang, is accused of dodging tariffs and is under civil and criminal investigation for possible smuggling, conspiracy and wire fraud by the Justice Department, Department of Homeland Security and Commerce Department.

Maybe the Aleris smelters would keep operating if China Zhongwang bought them, but at what risk to national security?

The delay occurs as companies that buy steel fear monger that tariffs or quotas would raise prices.

An expert, Stephen Koplan, chairman of the U.S. ITC under Presidents Bill Clinton and George W. Bush, says that’s hogwash. “Predictions of disaster were wrong 15 years ago when I chaired the ITC, and they are wrong again today,” he wrote in an op-ed in The Hill newspaper this week.

When President George W. Bush imposed tariffs and quotas on steel imports under Section 201 of the Trade Act of 1974, there was no price shock afterward, according to a study by the nonpartisan U.S. ITC.  Here is what Koplan, who also served as an attorney at the Small Business Administration, wrote:

“Downstream industries were not devastated by higher steel prices. Nor was the U.S. economy thrown into depression. The U.S. steel industry, however, earned a much-needed relief as the result of action taken by the president that allowed it to restructure and reinvest for the long term. In other words, the Section 201 measures worked as intended.

“We are facing similar challenges again today. . .Now, however, U.S. national security is at great risk if firm action is not taken immediately. The U.S. primary aluminum industry is on the verge of disappearing entirely, and the U.S. steel industry is not far behind.”

AK Steel Corp. CEO Roger Newport agreed with Koplan’s assessment that this is not a time for dawdling, telling the Commerce Department in his testimony on the steel case:

“High-end electrical steel is an incredibly difficult product to manufacture, as it requires a significant amount of dedicated, capital equipment and a sophisticated, well-trained workforce. Therefore, if AK Steel were to exit the market, there would be no operational electrical steel manufacturing equipment in the United States, the specialized labor and related expertise in operations would be lost, and many of AK Steel’s talented operators and researchers would either relocate to other businesses, industries and/or foreign countries, or become unemployed.”

Workers’ and companies’ economic security is at risk. The nation’s security is at risk. Resolution of these cases should be speeded, not delayed.

AFL-CIO Executive Council: Working People Need Real Trade Reform, Not Just Rhetoric

 (Silver Spring, Md., Wednesday, July 26, 2017) – For decades, America’s trade agenda has failed working people. Last year, voters in both parties called for change. In the early days of the Trump administration, actions have been initiated on existing trade policies, from assessing the national security impact of steel and aluminum imports to considering reform of the North American Free Trade Agreement and the U.S.-Korea Free Trade Agreement. Updating our nation’s trade deals is vital, but only if the focus is on how to increase and improve the quality of jobs. Much work lies ahead, and the direction and effectiveness of President Trump’s efforts still is unknown.

No task is more pressing than ensuring the administration’s renegotiation of NAFTA results in new rules that reflect the needs and interests of working families, not global corporations. NAFTA has failed working people in Canada, Mexico and the United States. Since NAFTA’s inception in 1994, corporate profits are up, but wages in all three countries are stagnant. Despite increased productivity, workers are not receiving a fair return on their work. There is more trade between the three NAFTA countries, but that trade is unbalanced, with the United States running consistent deficits with Mexico and Canada. The freedom to negotiate together is under attack in all three countries, diminishing the voices of working people and increasing inequality. As with other policy failures, broken trade deals disproportionately have harmed communities of color.

We can do better. NAFTA is not a failure of trade itself, but the result of trade rules rigged to favor global corporations and the wealthy elites in all three countries. Trade should be a cooperative endeavor that benefits us all. For that to happen, NAFTA must change dramatically.

NAFTA and its inequities can’t be fixed with mere tweaks or by substituting language from the failed Trans-Pacific Partnership. Nor should the United States adopt a strategy that pits the working people of North America against each other. We must end the race to the bottom that hurts working families, as it impoverishes our democracy and starves investment in our public infrastructure. We must replace NAFTA’s vicious cycle with a virtuous one—with a set of rules that promote shared prosperity for workers in all three nations.

We must incorporate the lessons learned from NAFTA’s failures into its new rules. This means NAFTA’s labor provisions must be substantially strengthened to improve protections for all working people, regardless of immigration status. NAFTA’s labor rules must meet international standards. Swift and certain monitoring and enforcement tools must replace the current convoluted, ineffective process. This will require effective labor inspections and explicit protections for workers who migrate, including a ban on recruitment fees, accountability for abusive practices by employers and labor recruiters, transparency regarding wages and terms of employment, and real access to justice and legal assistance. Only when all workers share these protections will we be able to effectively join together to negotiate for a better life.

A new NAFTA, with rules that working people help write, is an opportunity to begin constructing a Global New Deal for working families. The critical elements of a new NAFTA are:

  • A democratized renegotiation process
  • Strong labor rules with swift and certain enforcement that prevent the commodification of workers
  • Elimination of corporate courts
  • Enforceable currency rules
  • Stronger rules of origin
  • Protection for responsible government purchasing and Buy American policies
  • Improved screening for foreign domestic investment
  • Improved trade enforcement as part of a robust manufacturing policy
  • Elimination of obstacles to effective trade enforcement
  • New rules to prevent tax dodging
  • Removal of rules that undermine protections for workers, consumers and the environment
  • Commitments to invest in infrastructure
  • Consumer protections that ensure financial stability
  • Prohibition of unsafe and unfair cross-border transportation services
  • Protection for intellectual property while ensuring the right to affordable medicines
  • Prohibition on global corporations from using NAFTA to capture public services for profit
  • Strong environmental rules with swift and certain enforcement

Working people and our unions are united and will mobilize with the same level of intensity as our campaign to defeat the TPP. We will work to advance a set of positive and forward-looking trade rules through a comprehensive public campaign on the ground, online and over the air. The elements of the campaign will include the follow action points:

  • Educate elected officials, policy makers, opinion leaders and all workers about the causes and effects of NAFTA and other U.S. trade policies, showing there is another way, and that we need to act collectively to achieve a higher standard of living;
  • Report and publicize the impact of NAFTA on the quality of life for North America’s working people, including the effect on jobs, wages and negotiating power;
  • Demand greater democracy, transparency and participation in the NAFTA renegotiation process—and publicize any failure to open up the process;
  • Mobilize our members, community allies and all workers to demand a better NAFTA, with rules centered on working people’s policy choices—not those of the corporate class;
  • Develop and execute joint strategies with labor movements and allies in Mexico and Canada to ensure that meaningful and effective protections for working people and higher standards are at the core of any changes to NAFTA; and
  • Utilize all available strategies, including public and social media, to broaden the base of popular engagement and advance our vision of a worker-centered NAFTA.

Leo W Gerard: American Workers Seek Enforcement, Not Protection

American workers have made a simple request of politicians for decades: stop the trade violations that kill American manufacturers and jobs.

Art by dzejdi, Getty Images

American factories and workers are willing to compete. They are able to compete. But the playing field must be level. American workers and employers can’t win when their rival is not a company but a country. U.S. manufacturers and unions have filed untold numbers of cases against trade law violators, and they almost always win. As a result, the United States now has 28 separate tariffs on a variety of Chinese steel products, and in January it filed a complaint with the World Trade Organization about China’s aluminum policies.

But China and other countries continue to violate and circumvent the rules. So now, President Donald Trump is contemplating invoking a section of the Trade Expansion Act of 1962 to ensure America can produce its own steel and aluminum for national security. Badmouthing this effort as protectionism are importers and 1 percenters. They’ve tried to characterize American workers and their employers as crybabies seeking protection. But no one is asking for protection.  American workers and manufacturers want trade law enforcement to establish fair competition and ensure national security interests.

Those who have been screaming “protectionism” like banshees since Trump announced that his administration would investigate whether to impose tariffs or restrictions on imports of aluminum and steel for national security contend free trade enriches all countries involved. But what they don’t say is who gets that money. In the United States, it has all gone to the already filthy rich.

Sure, the price of paper and furniture is cheaper at Walmart, but that’s pretty meaningless to the North Carolina furniture builders who lost their jobs when their factories moved to China and the Maine paper workers who lost their jobs when their mills closed because of underpriced, government-subsidized Chinese imports.

And it’s not just individuals. Free trade has devastated hundreds and hundreds of small American towns that depended on that now-closed factory or mill to employ the populace and pay municipal taxes.

Workers at the Century Aluminum Co. plant in Hawesville, Ky., know that well. They’ve watched their region deteriorate as the nearby Whirlpool factory moved to Mexico, costing 1,100 workers their jobs. Cheap unfairly traded Russian imports put a local steel mill out of business. Underpriced Chinese imports closed down the area’s furniture factories. And a glut of subsidized Chinese aluminum on the international market shuttered an Alcoa smelter in nearby Indiana last year, costing 600 workers their jobs.

Still threatened is the Century Aluminum smelter, the last left in the United States that makes the specialty metal needed to protect soldiers in Army Humvees from improvised explosive devices (IEDs). Twice over the past five years, Century has issued notices to its workers in Hawesville that it would close permanently. Luckily for the town of 1,000 residents, Century has been able to reverse course on both occasions. Still, it has furloughed more than 300 workers and scrapped unused machinery for cash. It is one of only five smelters still operating in the United States, just two of which are running at full capacity. That is down from 23 smelters 24 years ago.

Sometimes a town that loses a major employer gets a new one. But all too often it’s just not enough. When Ormet Corp. closed its smelter in Hannibal, Ohio, in 2013, more than 600 workers lost their jobs. Now a power plant is planned. But it will employ only about 20.

American aluminum and steel workers are highly skilled. The plants where they work – or once worked – are efficient and emit far less pollution than their Chinese counterparts. All things being equal, they should be able to compete. But all things aren’t equal.

Many foreign competitors receive aid from their governments that is banned under trade rules they agreed to abide by. This includes free loans from state-owned banks, free land from local governments and state-subsidized raw materials.

Because of such blatant and outrageous trade law violations, U.S. Steel last year asked the government to stop all imports of Chinese steel. In its petition, U.S. Steel described in detail Chinese officials stealing trade secrets and Chinese companies engaging in a practice called trans-shipping, which is sending steel through a third country where it is falsely marked as originating to illegally duck tariffs.

U.S. Steel was one of five companies, including a specialty steel firm and an aluminum corporation, that the Chinese government cyber attacked. The U.S. government has criminally charged five Chinese military officials with economic espionage for breaking into U.S. Steel computers and swiping information on company strategies.

Soon after the Chinese cyber-attack, one of the country’s largest steel firms, Baosteel, used U.S. Steel trade secrets to produce specialty metal for the car industry, then exported some of it to the United States, in direct competition with U.S. Steel.

This pattern of cheating certainly has not stopped. Within recent days, it was announced that a Chinese state-owned bank was giving a $2.9 billion bailout to the largest aluminum producer in the world, China Hongqiao, which is staggering after allegations of fraud.

Such government-subsidized Chinese aluminum and steel flooding the international market and depressing prices kills American jobs. Bob Prusak, president of Magnitude 7 Metals, put it this way, “My company just purchased an aluminum producer that was in bankruptcy. We’re trying to restart that facility. It is impossible for us to do that if other companies receive seemingly endless subsidies or benefits from markets protected through tariff and non-tariff barriers.”

That aluminum smelter is in New Madrid, Mo., and was owned by Noranda. At one point, Noranda employed 900 workers there. Its closure last year threatens to destroy the town of 3,000, located in what is already among the poorest parts of the state.

Enforcement of international trade law – not protectionism – could help Magnitude 7 Metals restore those jobs and save the area from devastation. Enforcement would help ensure that the United States can produce the specialty aluminum that Commerce Secretary Wilbur Ross said is essential for production of F-35 fighter jets. Enforcement would help ensure that the United States can continue to produce the steel used in transformers crucial to electrical transmission. Only one domestic steel mill remains capable of forging that steel.

No American aluminum smelter or steel mill can remain in business just supplying the military. It must operate in a viable commercial environment. For that to happen, international trade rules must be enforced. A good first step in that direction would be imposing Trade Expansion Act penalties that are as strong as American defense must be.

Leo W Gerard: Stop China’s Stealth Invasion

A country claiming the greatest military on earth can’t be without some things. Steel is an obvious one.

Image from Getty Images

In the age of drones, aluminum is another. Aluminum is essential for flying machines like the F-35 joint strike fighter and Boeing F/A-18 Super Hornet, for armor plating on army vehicles and naval vessels and for countless infrastructure projects including bridges and roads.

Obviously, then, for the United States to retain top ranking, it must protect its aluminum industry. That industry, though, is under a two-pronged stealth attack from China. For more than a decade, the Chinese have ramped up their own aluminum production and dumped the excess on the world market, depressing prices and bankrupting Western producers. Now, a corrupt Chinese company that is under investigation by three U.S. agencies is trying to buy an American aluminum firm. To ensure national security, that must be stopped. America can’t be beholden to China for aluminum.

In 2000, China produced only 11 percent of the world’s aluminum. Now it’s more than 50 percent. Just between 2010 and 2015, China doubled production, even as demand for aluminum within the country slowed. Chinese companies continued to ramp up because they received massive government subsidies, including cheap power, loans and raw materials. That kept Chinese workers employed but created stockpiles of aluminum. So China exported the excess, overwhelming the world market and driving down prices.

This shattered the U.S. industry. In 2000, 23 aluminum smelters operated in the United States. Now there are only five, with just two at full capacity. Thousands of American aluminum workers lost their good, family-supporting jobs in just the past three years.

Aluminum producers filed formal complaints with the U.S. Department of Commerce about the illegal subsidies and about Chinese companies dumping products in the United States at prices below production costs. And in 2011, the department penalized Chinese extrusion producers, including one called China Zhongwang, with tariffs as high as 374.15 percent.

With that added cost, China Zhongwang’s U.S. sales plunged. Zhongwang, the world’s second-largest producer of aluminum extrusions, then schemed to dodge the sanctions, leading to criminal and civil investigations of possible smuggling, conspiracy and wire fraud. The Justice Department, Department of Homeland Security and Commerce Department are all scrutinizing Zhongwang.

Zhongwang and associates are accused of shipping nearly 1 million tons of aluminum to Mexico with the intent of then sending it across the border tariff-free under the terms of the North American Free Trade Agreement, as if it had been manufactured in Mexico. Shortly after the aluminum trade association discovered this massive stash, amounting to 6 percent of the world’s aluminum inventory, much of it was whisked away to Vietnam, another country notorious for involvement in what is called transshipment, that is, concealing commodities’ country of origin to evade tariffs.

In addition, the U.S. Aluminum Extruders Council accused Zhongwang and companion companies of another plot to skirt tariffs. Firms associated with Liu Zhongtian, a Chinese billionaire who controls Zhongwang, shipped thousands of tons of pallets made of aluminum extrusions to a factory in a Philadelphia suburb.

These “pallets,” which weighed more than three times American-made aluminum pallets, escaped tariffs specific to extrusions because, supposedly, they were pallets. Pallets, typically though, are designed to be light to reduce shipping costs.

Company officials contended the heavyweight pallets made from extrusions were to be sold as pallets, not dismantled or melted for other uses. Shortly after the Wall Street Journal began asking questions about them, though, they disappeared. Just like the $2 billion worth of aluminum in Mexico.

The Commerce Department wasn’t fooled by this sleight of hand. In November, it announced that the pallets were an attempt to circumvent the 2011 tariffs on extrusions.

Even while Zhongwang remains under investigation, it announced plans to buy American aluminum company Aleris for $2.3 billion from a private equity firm. Aleris, with 14 plants around the world, makes rolled aluminum for a variety of industries, including aerospace and automotive, and significantly, armor plate for the U.S. military.

The U.S. military cannot be dependent on a Chinese-owned company to outfit American armored vehicles or meet other critical needs. In November, a dozen U.S. senators asked Obama’s treasury secretary to block the deal because it would “directly undermine our national security, including by jeopardizing the U.S. manufacturing base for sensitive technologies.” My union, the United Steelworkers (USW), which has 950 members employed at Aleris, also has repeatedly protested the proposed sale, including in a letter sent last week to new Treasury Secretary Steven Mnuchin.

It would be far too easy for Zhongwang to appropriate Aleris’ trade secrets, then run the company into the ground, further cementing China’s illegally-subsidized domination of the world aluminum market. Zhongwang could also exploit Aleris operations to circumvent U.S. tariffs. Based on past performance, that would be no surprise.

The U.S. government has taken important steps toward protecting the crucial American aluminum industry. Before he left office in January, former President Obama launched a formal complaint with the World Trade Organization against the Chinese government over its subsidies to the aluminum industry.

In March, the Commerce Department began investigating complaints that Beijing illegally subsidized aluminum foil shipped to the United States by 230 Chinese companies.

Last month, the Trump administration initiated an inquiry into the effect of aluminum imports on U.S. national security, which could lead to tariffs or import restrictions. But it’s not Canada or some other allied country causing the problem. It’s China.

And just last week, the Senate confirmed Robert Lighthizer as U.S. trade representative. He has railed against America’s comatose response to abusive Chinese trade practices that have bankrupted American industries and killed American jobs. That includes dirty tricks like creating pallets out of extrusions and transshipping from Mexico and Vietnam.

Lighthizer assured the Senate he intended to firmly enforce trade law. That’s good because he must stop China’s stealth invasion before it overcomes the entire U.S. aluminum industry.

Leo W Gerard: Speak Loudly And Carry A Big Aluminum Bat

During this very month last year, aluminum smelters across the United States were closing, one after another. It was as if they produced something useless, not a commodity crucial to everything from beverage cans to fighter jets.

In January of 2016, Alcoa closed its Wenatchee Works in Washington State, costing 428 workers their jobs, sending 428 families into panic, slashing tax revenue counted on by the town of Wenatchee and the school district and devastating local businesses that no longer saw customers from the region’s highest-paying manufacturer.

That same month, Alcoa announced it would permanently close its Warrick Operations in Evansville, Ind., then the largest smelter in the country, employing 600 workers, within three months.

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Worker at Alcoa’s Warrick smelter in Evansville, Ind., before it closed in 2016. Photo by Steven Dietz, Sharp Image Studios, Pittsburgh.

Then, Noranda Aluminum fell. It laid off more than half of the 850 workers at its New Madrid, Mo., smelter in January, filed for bankruptcy in February and closed in March. The smelter was a family-supporting employer in a low-income region, and when it stopped operating, the New Madrid County School District didn’t get tax payments it was expecting.

This devastation to workers, families, communities and corporations occurred even after Ormet had shuttered a smelter in Ohio in 2013, destroying 700 jobs and Century closed its Hawesville, Ky., smelter, killing 600 jobs, in August of 2015.

It all happened as demand for aluminum in the United States increased.

That doesn’t make sense until China’s role in this disaster is explained.

That role is the reason the Obama administration filed a complaint against China with the World Trade Organization (WTO) last week. In this case, the president must ignore the old adage about speaking softly. To preserve a vital American manufacturing capability against predatory conduct by a foreign power, the administration must speak loudly and carry a big aluminum bat.

The bottom line is this: American corporations and American workers can compete with any counterpart in the world and win. But when the contest is with a country itself, defeat is virtually assured.

In the case of aluminum, U.S. companies and workers are up against the entire country of China. That is because China is providing its aluminum industry with cheap loans from state-controlled banks and artificially low prices for critical manufacturing components and materials such as electricity, coal and alumina.

By doing that, China is subsidizing its aluminum industry. And that is fine if China wants to use its revenues to support its aluminum manufacturing or sustain employment – as long as all of the aluminum is sold within China. When state-subsidized products are sold overseas, they distort free market pricing. And that’s why they’re banned.

China agreed not to subsidize exports in order to get access to the WTO. But it has routinely and unabashedly flouted the rules on products ranging from tires to paper to steel to aluminum that it dumps on the American market, resulting in closed U.S. factories, killed U.S. jobs and bleak U.S. communities.

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Worker at Alcoa’s Warrick Operations in Evansville, Ind., before the smelter closed in 2016. Photo by Steven Dietz, Sharp Image Studios, Pittsburgh.

In 2000, China produced about 11 percent of the aluminum on the global market. That figure is now 50 percent. A big part of the reason is that China quadrupled its capacity to produce aluminum from 2007 to 2015, and increased its production by 154 percent.

When China threw all of that extra, cheap, state-subsidized aluminum on the global market, it depressed prices. In that eight-year period, the price sank approximately 46 percent.

To compete, American smelters tried cutting costs and getting better deals on electricity. But even as U.S. demand increased, U.S. production declined 37 percent. And capacity decreased 46 percent.

What capacity decrease means is closed plants. The number of smelters dropped from 14 in 2011 to five last year, with only one operating at full volume.

Many of these manufacturing workers, thrown out of their jobs by what is clearly unfair trade, saw President-elect Donald Trump as a champion. Donald Trump said he would hold China to account on trade. He promised he would impose massive tariffs on goods imported from China. He said he would confront Beijing on currency manipulation, a practice that makes Chinese goods artificially cheap.

Many of those manufacturing workers voted for Donald Trump. Monroe County, Ohio, is a good example. That was the home of the Ormet smelter. The workers, who belonged to my union, the United Steelworkers, and the company asked Ohio Gov. John Kasich in 2012 and 2013 to intervene with the utility to get lower rates to help Ormet survive.

Kasich refused. The smelter closed. Monroe County’s unemployment rate now is the highest in Ohio at 9 percent, nearly twice the national rate.

Monroe County voters didn’t forget. Theirs was among the counties in Ohio that went for Donald Trump in the Republican primary. Though Trump didn’t win the Ohio primary, he got 35.9 percent in the crowded GOP field, and he took virtually all of the places in Ohio that, like Monroe, would say Kasich and other politicians turned their backs on them.

President-elect Trump carried 29 of Ohio’s Appalachian counties in the primary, those described as “geographically isolated and economically depressed.” These are counties that, like Monroe, lost family-supporting jobs in steel, manufacturing or mining. For the workers who haven’t left, the jobs that remain, in retail and fast food, don’t pay much, don’t provide benefits and aren’t secure.

When Donald Trump came to town talking tough about China, that sounded a hell of a lot better to those workers than their governor telling them he wouldn’t help with electrical rates – especially after they watched the governor in New York work a deal to save an Alcoa smelter and 600 jobs for 3 years in Massena.

And, of course, Donald Trump won Ohio in the General Election.

Workers across America, from Sebree, Ky., and Mt. Holly, S.C., where Century smelters are threatened to Wenatchee, Wash., where Alcoa has held out the possibility that the smelter could be restarted, were galvanized to support Donald Trump by his promises to confront China on its predatory trade practices.  If he fulfills those pledges, he will have the back of the blue-collar workers who had his.

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Worker at Alcoa’s Warrick smelter in Evansville, Ind., before it closed last year. Photo by Steven Dietz, Sharp Image Studios, Pittsburgh.

Berry Craig: Trump Could Create American Jobs Right Now

trump-lies-720

Image by Bill Day all rights reserved

By BERRY CRAIG
AFT Local 1360

To hear GOP presidential hopeful Donald Trump tell it, jobs will fall upon the land like manna from heaven if he’s elected.

But why wait, Mr. Trump? You can prove you’re a job creator right now: Start making your duds and other stuff stateside instead of abroad.

“Trump’s products have been made in 12 other countries,” claims an ad from the campaign of Hillary Clinton, his AFL-CIO endorsed Democratic foe. TheWashington Post verified the charge.

“We know of at least 12 countries where Trump products were manufactured (China, Netherlands, Mexico, India, Turkey, Slovenia, Honduras, Germany, Bangladesh, Indonesia, Vietnam and South Korea),” wrote the Post’s Michelle Ye Hee Lee. All but the Netherlands and Germany are low-wage countries.

“Further, Trump products traveled through other countries through the packaging and shipping process — meaning workers in more than 12 countries contributed to getting many of Trump’s products made, packaged and delivered to the United States.”

Two western Kentucky labor leaders are on to Trump’s hypocrisy on jobs. “He says he wants to bring jobs back to America, but all of his signature lines are made somewhere overseas,” said Jeff Wiggins, president of Steelworkers Local 9447 in Calvert City and president of the Western Kentucky AFL-CIO Area Council in Paducah.

“Why doesn’t some reporter stick a mike in Trump’s face and say ‘When are you going to bring your jobs back?'” asked Jimmy Evans, business manager of Paducah-based IBEW Local 816 in Paducah and a council delegate.

Meanwhile, Trump, though a proven big league outsourcer, continues to lambast outsourcing and trade deals like the North American Free Trade Agreement, which grease the skids for American companies like his to shift production and jobs—and often bust unions in the process—abroad, usually to cheap labor countries.

So think about it.

Would a President Trump really deep-six trade deals and stop outsourcing, moves that would hit him where it hurts him the most—in his bank account?

Oh, Clinton, as Trump loves to point out, was for NAFTA before she came out against it. But mum’s the word from Trump about how he was cool with outsourcing before he ran for president.

But here’s another point to ponder: Clinton doesn’t make a pile of money off products made in low wage countries and shipped stateside. Trump does. Hence, who’s more likely to put the kibosh on trade deals and outsourcing–the candidate who fattens his wallet off outsourcing or the candidate who doesn’t?

Anyway, the other day I heard a Bernie Sanders booster, who I’d bet the farm won’t vote for Clinton, blame her and the whole Democratic party for NAFTA and other job-killing trade deals. Trump would love this guy who fancies himself a liberal and claims to be a Democrat.

It’s true that President Bill Clinton backed NAFTA in 1993. But most Democrats in Congress didn’t. The Republicans got NAFTA passed.

In the House, 102 Democrats voted “aye” and 156 “nay.” The Republicans were for NAFTA 132-43. One independent voted no. His name is Bernie Sanders and he’s now in Clinton’s corner and in the Senate.

On the Senate side, the GOP went for NAFTA 34-10. The Democrats were 28-27 against NAFTA. (One Democrat did not vote.)

Donald Trump Right to WorkTrump, too, is fine with American companies moving jobs and production from one state to another. Almost always, the migration involves a unionized company closing down and pulling up stakes in a non-“right to work” state and reopening non-union in a RTW state.

Trump prefers RTW states to non-RTW states.

Trump is like the Kentucky horse trader of old. He’s happy to show you his teeth, but not the horse’s.

In Pennsylvania, Clinton And Kaine Introduce Bold Jobs Plan With A Focus On American Manufacturing

Clinton and Kaine Contrast 100 Day Jobs Plan with Trump’s Record of Outsourcing

Hillary Clinton speaking on July 29, 2016 - Harrisburg, PA.  Photo by Adam Schultz for Hillary for America.

Hillary Clinton speaking on July 29, 2016 – Harrisburg, PA.
Photo by Adam Schultz for Hillary for America.

(Johnston, PA) On the second day of their “Stronger Together” jobs-focused bus tour through Pennsylvania and Ohio, Hillary Clinton and Senator Tim Kaine of Virginia continued introducing the American people to their 100 days jobs plan, which will make the largest investment in new, good-paying jobs since World War II during their first 100 days in office.

They visited Johnstown Wire Technologies, a factory with a record of creating jobs and investing in America. Highlighting her plans to invest $10 billion to strengthen manufacturing communities like Johnstown.

She also highlighted an economic analysis by a former McCain advisor that said Clinton’s plans would create over 10 million jobs in her first term alone.

“In this county, you’ve got 125 to – 129 manufacturing businesses just like Johnstown Wire that employ nearly 4,000 people. And Hillary’s going to talk at some length about our ‘Make It in America’ plan that will invest $10 billion in communities just like Johnstown,” said Senator Tim Kaine. “We’ll put workers first, we’ll put their wages first, we’ll put their families first. We’ll reject trade agreements like the TPP that don’t meet the standards that they ought to meet.”

“And we need to do something that has a direct tie to Johnstown Wire’s business, which is invest in infrastructure, so that everybody’s able to get around. We can have a power grid that works, we’ve got bridges that are solid, because these kinds of jobs and infrastructure hire people today and raise our platform of economic success down the road,” added Kaine.

“Within the first 100 days of our administration, we are going to break the gridlock in Washington and make the biggest investment in new, good paying jobs since World War II,” said Secretary Hillary Clinton. “We will start by making the boldest investment in America infrastructure since we built the Interstate Highway System back in the 1950s.”

Tim Kaine praised Clinton’s dedication to protecting American manufacturing jobs, saying “And we’re on this tour so that we can talk about the American economy: to talk about manufacturing; to talk about the way to grow jobs and make sure everybody benefits from our economic growth, not just a few. And that’s why I admire Hillary so very, very much.”

Clinton talked about her work with United Steelworkers International President Leo W Gerard and her work fighting for unions and all working people.

“I believe with all my heart that the economy should work for everyone, not just those at the top. Leo knows because when I was privileged to work with him. To stand up for steelworkers. To start the very first Manufacturing Caucus in the United States Senate. I had no idea then that I was going to run for president. What I cared about is that I had lots of great people in New York who saw their jobs leave. Who lost them to automation and technology. Who were the victims of efforts to bust unions and undercut fair wages and benefits. So what I wanted to do was to make it clear that in America, we’re going to keep making things. Anyone willing to work hard should be able to find a job that pays well enough to support a family. That’s the basic bargain of America,” Clinton said.

Clinton and Kaine also contrasted their shared vision for an American economy that works for everyone—not just those at the top—with Trump’s long record of outsourcing products to be made overseas, instead of here in America.  As Clinton said, “Donald Trump, you hear him, he talks a big game about putting America first. Well, with all due respect, please explain to me what part of America first leads Trump to make Trump dress shirts in Bangladesh, not Ashland, Pennsylvania. Or to make Trump furniture in Turkey, not Freeburg, Pennsylvania. Or Trump picture frames in India, not Bristol, Pennsylvania.”

Clinton continued, “So Donald Trump says he wants to make America great again. Well, he could start by actually making things in America again. Now, if we’re serious about investing in America manufacturing, we have to be serious about defending American workers, and that means we’ve got to defend the right to organize and bargain collectively, which helped to build the American middle class in the first place.”

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