Trumka to Obama: Fast-Track is Dead; Construct Pro-Worker Trade Policy

WASHINGTON –Declaring presidential “fast-track” trade authority dead, AFL-CIO President Richard Trumka is challenging Democratic President Barack Obama to construct a new pro-worker U.S. trade policy, as part of larger pro-worker economic policy.

In a major speech on fast-track and trade, and in Q&A afterwards, Trumka called the president’s trade plan “dead on arrival” in the U.S. Senate because then-Senate Finance Committee Chairman Max Baucus, D-Mont., couldn’t find any other Democrats to support it on his panel, which writes trade laws.

Over in the GOP-run House, though Trumka did not say so, three-fourths – 150 – of the House Democrats have abandoned Obama’s fast-track scheme, as have at least 28 Republicans.

The death of fast-track, Trumka told the Center for American Progress, gives Obama the opportunity to construct a new trade policy to benefit workers in the U.S. and worldwide that guarantees labor rights, that protects Buy America federal, state and local rules and that  is not tilted towards corporations, among other positive factors.

And when Obama agrees to go in that new direction, labor stands ready to work with him on crafting it, Trumka pledged.  Organized labor is not against trade, he declared, but against unfair trade.  “The question is how the U.S. engages in the global economy, and what it means for American workers and workers around the world,” he explained.

Fast-track, formally called trade promotion authority, lets a president jam legislation implementing trade pacts through Congress with no input from the U.S. people or lawmakers, no amendments, no labor rights, with limited debate and on one up-or-down vote in each house.  Starting with NAFTA, presidents have used fast-track to push through trade pacts.

The corporate tilt Trumka cited dominates those U.S. trade pacts, has cost hundreds of thousands of jobs and is a factor in increasing U.S. income inequality, he said.

But U.S. trade officials and the business community that pushes fast-track and trade pacts don’t consider those results, or public opposition to unfair trade, he said.  “If you close your eyes and listen to their talk, you’d think it was 1999 or 1994,” Trumka commented.  “We can’t enact a failed model” of trade policies or economic policies, he added.

Trumka said he’s carried the rethink-trade-policy message to Obama’s U.S. trade representative many times.  Trumka declined to give the USTR’s responses.

The goal of any new trade policy, he added, “should be to create enforceable labor standards, environmental standards and consumer standards – and to structure the pacts to drive wages up.”  Past pacts, he said, drove wages down by encouraging corporations to offshore and export U.S. jobs unless U.S. workers agreed to much lower living standards.

Death of fast-track, Trumka said after the formal Q&A, also means two trade pacts Obama is negotiating – one with 11 other Pacific Rim countries and the other with the 27-nation European Union – are dead in Congress, at least for this year.  If fast-track were to pass, Obama would submit legislation implementing the two.

Most of the criticism of those trade pacts has centered on the Trans-Pacific Partnership (TPP), which includes extremely low-wage nations that lack worker rights, such as Vietnam.  But Trumka said there are pitfalls in the proposed pact with Europe, too.

One is that big financial institutions “on both sides of the Atlantic” would use that pact to undermine central bank requirements that curb financiers’ speculation.  Such speculation, with shaky or no asset backing, led to the 2008 Great Recession, which cost workers millions of jobs in the U.S. and worldwide, he said.

“Our trading partners” over the last 20 years “pushed weak unions, low wages and subsidies for foreign investment – such as tax-free export zones.  That gave us a global financial system” that produced the crash, he explained.  The old model of trade pacts “fuels bubbles and busts.  And ever since the 1980s, big business has looked offshore first, rather than America, as the place to invest.”

A new trade policy must be crafted to produce the opposite results, he declared.  The federation has put together its own trade policy package and is touting it to lawmakers.  It includes enforceable worker rights – notably the right to organize and bargain – and continued central bank requirements for financiers to back their trading with sufficient capital.

The fed’s package also includes preserving Buy America laws, a ban on using government procurement rules as a way to undercut public servants’ jobs through outsourcing and offshoring, and enforceable language saying that currency manipulation is an unfair trading practice that can be penalized, Trumka explained.

That trade policy should be part of a wider Obama economic policy designed to benefit workers, not corporations, he said.  “Its best advocate – on his better days – has been Obama,” Trumka said, recalling the president’s statements at a 2009 summit of industrial nations, held in Pittsburgh.

“But we need to pursue policies for a strong cycle of global growth,” he said, “including a global New Deal to bring electricity, water, roads and the Internet” – among other infrastructure –  “to everyone worldwide.”

That global growth policy would focus on raising workers’ wages, thus increasing living standards and purchasing power for all workers, in the U.S. and abroad, he added.