NAFTA Renegotiation Should Reject Neoliberalism and Economic Nationalism

A deal between the US and Mexico on a renegotiated North American Free Trade Agreement (NAFTA) may be announced any day now, marking the first revision of the deal since its signing.

A product of the neoliberal “Washington Consensus,” the pact between the US, Canada and Mexico went into effect in 1994 and became a model for many trade agreements that followed. NAFTA has long been in the crosshairs of unions, progressive campaigners, leftists, environmental groups and consumer advocates for its pro-corporate, anti-regulatory policies and outsourcing incentives.

Indeed, NAFTA was made systematically more damaging by every administration since its signing.

But before the ink was dry, on January 1, 1994, the Zapatista guerrilla movement rose in southern Mexico and signaled the start of an anti-NAFTA battle that shook the world. The fight grew into a global justice movement that won the 1999 “Battle in Seattle” against the World Trade Organization (WTO) and prevented an attempted NAFTA expansion through the Free Trade Areas of the Americas.

This global, internationalist “movement of movements” has won many battles since, most recently with last year’s defeat of the Trans-Pacific Partnership (TPP). While Donald Trump formally buried the TPP, the reality is that President Obama, a united corporate lobby and GOP congressional leadership could not get the deal approved the prior year.

The agreement had been made politically impossible by some of the same folks that shut down the WTO in the streets of Seattle.

This is all well and good, and even a cause for inspiration in these bleak times. But it’s necessary to point out the elephant in the room: Opposition to free trade deals like the TPP and NAFTA also helped Donald Trump swing traditionally Democratic states and pave a path to the White House.

The NAFTA Renegotiations

When the 2008 financial crisis hit, it slammed communities that had already been decimated by the waves of outsourcing and wage stagnation that NAFTA had exacerbated. Both Bernie Sanders and Donald Trump tapped into working-class opposition to corporate-rigged “trade” deals in these communities and brought NAFTA back into the political debate.

After a many months delay on a campaign promise to immediately start renegotiations, last August, Trump’s chief trade negotiator, Robert Lighthizer, began working with his Mexican and Canadian counterparts on changes to NAFTA. Those conversations, which came to include a number of progressive demands, will likely come to a conclusion in the next week.

Though Canada has been sitting out talks since May, the US and Mexico are now hoping to lure them back to the table. Mexico’s incoming populist-left government has also had a negotiator listening in for the past few months.

Let’s be clear: No one believes that the administrations of Trump, outgoing Mexican President Enrique Peña Nieto and Canadian Prime Minister Justin Trudeau will deliver a NAFTA deal that fully meets all of the benchmarks endorsed by over 1,000 civil society groups. But elements of long-held demands have already made headway in the policy arena that would have been unthinkable just a year or two ago.

This happened because efforts led by labor and civil society have created a context where such demands must be met to garner the support needed to approve a new agreement in Congress.

What faces us now could be a rare opportunity to stop some of NAFTA’s most serious ongoing harm and make changes to the US trade agreement model, changes which labor and human rights activists have sought for decades.

NAFTA’s Legacy and Potential Future

The corporate-rigged deal was first signed in 1992 by George H. W. Bush, and despite a major national campaign against it by unions and progressive groups, was railroaded through Congress by Bill Clinton a year later. His betrayal of the Democratic Party base helped the GOP seize control of the House in 1994.

As opponents predicted, NAFTA has resulted in almost 1 million American jobs lost, this according to the certifications of just one narrow government program. And more jobs are being outsourced under NAFTA every year.

Taxpayers in Mexico and Canada have also paid hundreds of millions of dollars to multinationals through Investor-State Dispute Settlement (ISDS) attacks on environmental, public health, water, forestry and land use rules and toxic bans.

The stunningly undemocratic ISDS system, which empowers multinational corporations to sue governments for unlimited compensation before tribunals of corporate lawyers for violating their claimed special rights under NAFTA, has been at the heart of labor and civil society groups’ opposition to many free-trade agreements signed since NAFTA.

According to American labor and nongovernmental sources close to the renegotiations, proposed changes to NAFTA include dismantling the ISDS system and the outrageous natural resources “proportional sharing” language that required Canada to export to the United States a set “proportional” share of its timber, water and energy.

The emerging deal also reportedly provides stronger labor standards, including terms that would eliminate the fake “protection” unions in Mexico that conspire with companies to keep wages pitifully low. If a final text includes such changes – and it is enforceable — it could help transform labor rights in Mexico.

President-elect Andrés Manuel López Obrador has indicated he will implement a deal his predecessor Peña Nieto may sign, and has offered support for some of the changes, including improvements in labor standards that could raise wages in Mexico.

Of course, any final deal must be closely inspected by labor and civil society groups to ensure no attacks on affordable medicine access, financial regulation or other consumer issues are buried within it.

These changes, if they come to pass, would halt some of NAFTA’s worst ongoing damage. It would also create a foundation for a new trade paradigm that the corporate lobby despises. That’s why the billionaire Koch brothers and other corporate-backed interest groups like Farmers for Free Trade are running multimillion-dollar PR campaigns directing Americans to support the status-quo and stand behind the current neoliberal trade model.

Is There an Opportunity to Win Meaningful Changes to NAFTA Under Trump?

During his presidential campaign, Trump hijacked progressive trade critique and twisted it into a right-wing populist misdiagnosis of what is wrong.

Mexico and other countries did not cook up these deal to “get us.” Rather, US trade negotiators and a corporate-heavy network of official US trade advisers conspired with their counterparts in Mexico and Canada to impose a set of rules that have wrought real damage throughout North America.

When NAFTA changes are announced, progressive and leftist groups must be prepared to effectively promote enactment of a deal we support or stop a deal we oppose, and frame any acceptable outcome as delivering on our longstanding demands. This is not only a critical policy question, but also a political imperative.

If the deal does not measure up, we must be prepared to communicate to those Trump appealed to with his appropriation of progressive and radical trade critiques that his deal is more of the same rigged rules that he claims to oppose.

The trade and globalization policy debate in the United States — and indeed, globally — is at an unprecedented turning point. This has not occurred by chance. The damage caused to millions of people by the status quo trade model has made “trade” issues ripe for political exploitation.

NAFTA and the model it hatched are more vulnerable today than at any point. It is critical in this moment to elevate real alternatives that counter both neoliberalism and Trump’s nationalist alternative.