ABSTRACT: North American Federation of Trade Unions: A Response to NAFTA

Dave Barrett and Molly Laster
Western Washington University

In the absence of an effective social charter in the North American Free Trade Agreement (NAFTA), it is necessary for trade unions in North America to organize and address the threat posed to workers in all three NAFTA countries by increasingly powerful t ransnational corporations and the increasingly globalized market. In response, this study proposes the creation of the North American Federation of Trade Unions (NAFTU) -- an organization concentrating in five areas: research, social action, political act ion, education, and organization.

NAFTA and the labor and environmental side accords written to complement it offer little protection to labor rights, social conditions, or the environment. Nations are all but encouraged to lower their standards to attract investment. The scope and power of NAFTA in both spheres are limited, and proceedures are long and complicated. Public accountability is also limited, and, in the case of the labor accord, only governments have standing to make complaints. Current international agreements and precedents are also threatened under NAFTA. The most important protections to labor -- including the right to organize and bargain collectively -- are explicitly not covered in the agreement.

The economic impacts of NAFTA have been difficult to assess. There have, however, certainly been downward pressures on wages and working conditions. The U.S. trade surplus with Mexico has become a deficit. By mid August 1995, nearly 70,000 U.S. workers ha d applied for NAFTA Transitional Adjustment Assistance. By September over 42,000 workers had been certified. Canada has nothing analogous to the NAFTA -TAA, making impact assessment even more difficult. While Mexico did enjoy some job gains following the passage of NAFTA, albeit not enough to keep up with the growth of the labor market, the bottom fell out for all but the maquiladora sector following the peso crisis and devaluation. Average wages have already fallen from $2.65 to $1.80 per hour ($1.15 in the maquiladoras), and predictions are that one million Mexicans will lose their jobs in 1995.

Thus far the development of free trade in North America has been welcomed by business interests and feared by labor. While there are several examples of successful transborder solidarity among individual labor organizations, there has been no move to crea te an encompassing organization to counterbalance business interests. It is time to respond to the increasing globalilzation of the economy with a comprehensive and integrated program.