Union Leaders, Lawmakers Tell U.S. International Trade Commission: TPP Would Slam U.S. Workers

Mark Gruenberg Editor, Press Associates Union News

The pending Trans-Pacific Partnership (TPP) “trade pact” between the U.S. and 11 other Pacific Rim nations would slam U.S. workers in a wide variety of ways and worsen income inequality here, union representatives told the International Trade Commission.

Speaking at the opening of three days of ITC hearings on the trade pact, United Steelworkers President Leo Gerard and AFL-CIO trade specialist Celeste Drake painted a dismaying picture of TPP’s impact on U.S. workers and the economy.

“A trade agreement could be the path to a brighter future. A path to reversing wage stagnation and rising income inequality. A path to reducing our unacceptably high trade deficit. A path to reclaiming and increasing manufacturing jobs and the overall health of the sector,” Gerard testified.

"Unfortunately, the final TPP agreement is just the opposite. It is a path leading to more off-shored production and outsourced jobs as well as continuing income stagnation, or declines and lost opportunity,” he said.


The ITC held the hearings Jan. 15-17 to help it prepare a report for Congress on the trade pact and its impact. Most ITC witnesses were business lobbyists backing the TPP. The report is due in 105 days, before lawmakers vote on legislation to implement the trade pact.

Unlike previous specific trade cases Gerard brought to the ITC, the wide-ranging Trans-Pacific Pact "will have a serious adverse impact on production, employment and wages here in the U.S. and undermine our economy and our national security," he told commissioners.

Gerard, Drake, Sen. Sherrod Brown, D-Ohio, and Rep. Sander Levin, D-Mich., all urged the ITC to evaluate the trade pact based on real world experience with the impact of past trade pacts, including stagnating and declining U.S. wages, loss of high-paying factory jobs.

"Trade policies need to be measured by the very real impact they have had on the lives and livelihood of our citizens," Gerard said. "The realities are far, far different from theoretical models" of full employment and rising wages trade pact backers use and ITC has accepted.

"It is an oversimplification to assume that a worker who is laid off" due to a trade pact "can seamlessly transition from one sector to another," added Brown. "She doesn't find other work overnight. She could be out of a job for months, maybe even more than a year."

Gerard said steel workers and their industry "would be particularly hard hit" by the TPP and they "don't deserve that." The pact does nothing about one prime cause of steel dumping, foreign currency manipulation, he noted. And it fails in other steel-related areas, he added.

Gerard called the currency manipulation "predatory" and "a tax on U.S. exports" as well as a subsidy for the currency-manipulating country's exports to the U.S.

That will particularly affect not just autos, but auto parts, many of them made with steel, Gerard and Brown said. The TPP would let the 11 nations also  manipulate "rules of origin" to bring in parts they import at low cost and transship them -- also at low cost -- to the U.S., the senator explained. That costs U.S. auto part workers jobs.

Gerard pointed out that past experience with trade pacts and their enforcement – or lack of it – has led to shuttered factories, jobless workers, declining wages and dozens of trade cases before the ITC and federal agencies, detailing unfair foreign trade. The Steelworkers have led both U.S. labor and business in gathering evidence for and filing those complaints.

Brown particularly cited the impact of past trade pacts on the steel and auto industries. Auto firms are steel companies' biggest customers and the TPP would hurt them, Brown said.

Gerard also said the TPP's pro-labor provisions are weak, delayed -- in the case of Vietnam, which bans organizing -- or nonexistent, in Mexico. They're rife with words such as "may", "endeavor" and "as appropriate," he said.

"The impact of those terms, combined with the wholly discretionary nature of enforcement, is clear: (TPP) Countries will have to do little, if anything, to comply with commitments" on worker rights, Gerard told the commissioners.

Brown made many of the same points, and noted the TPP allows other nations to join later. That invariably leads to "the elephant in the room:" China. China is not one of the 12 nations, including the U.S., that have signed the TPP. But unlike other trade pacts, Brown noted, the TPP allows other nations to join in the future.

"Given China's influence in the region, it is critical" that the ITC analysis also cover TPP's impact on U.S.-China trade and whether China can use those rules-of-origin provisions to transship cheap goods here through the TPP countries, Brown said.

Under "fast-track" trade rules, lawmakers can take only one up-or-down vote each in the House and the Senate. Only a simple majority can pass the TPP implementation bill. Debate is limited and lawmakers can’t change the legislation to protect workers.

The TPP's harms and that scenario have led to an intense labor-led campaign, joined by community, environmental and religious groups, among others, to derail and defeat the pro-TPP legislation.

Drake and Gerard told the ITC unions are not against trade, but are against unbalanced trade rules. “The relevant question is not whether the AFL-CIO supports trade with these eleven countries. We do. The question is whether imposing the rules enshrined in the TPP, as written, will promote higher wages and inclusive growth in the U.S. and across the TPP countries. In our view, it will not,” Drake said.


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