HomeThe New NAFTA ’USMCA’ is a Disastrous Deal

Yesterday, Trump signed the new NAFTA ‘USMCA’ trade deal which nothing but an attack on workers, consumers, the environment, and democracy. Like NAFTA, it is a deal that legitimizes transnational slavery-like economics, allows more centralizations of powers and leaves workers with the crumps of the profit. 

It shows why we need to break the failed two-parties system and fight against the corporate-managed trade policies of the corporate-funded Democratic and Republican parties. The USMCA – contrary to Trump claims, is nothing but an updated version of NAFTA, which has been one of the main obstacles to localizing businesses and jobs and central to the destruction of manufacturing in the US.

What we need is to decentralize economic power, localize businesses instead of globalizing them and invest in small businesses and family farms.

I object to the following provisions of the USMCA:

  1. The USMCA keeps the authoritarian Investor-State Dispute Settlement process from NAFTA. This process sets up secretive trade tribunals that include corporations and states and that exclude labor unions and the public.
  2. It favors corporate agribusiness instead of small farmers working the land in all three countries. It also favors corporate agribusiness instead of consumers on food safety and labeling with respect to additives, processing, GMOs, and country of origin.
  3. The deal allows any party to block enforcement proceedings by refusing to appoint arbitrators to a dispute panel. Labor standards will remain as unenforceable under USMCA as under NAFTA.
  4. Provision 30.2 in the USMCA makes it even worse than NAFTA. It is a disastrous provision that gives the board of commissioners more power than Congress. People elect Congress to represent them in managing their lives, the deal hijacks our right and gives it to an elected entity. It preserves the right of changing and modifying provisions in the deal to the commissioners without the need to Congress permission. In other words, the USMCA’s Free Trade Commission can make changes to the agreement itself, implement changes to the agreement, change the rules by which it operates, approve who serves on its lower subordinate committees, and oversee the work of those committees like an international bureaucracy or government — all without the consent or approval of Congress. The Free Trade Commission will also oversee committees on Agricultural Trade, Rules of Origin and Origin Procedures, Textile and Apparel Trade Matters, Customs and Trade Facilitation, Technical Barriers to Trade, Government Procurement, Transportation Services, Financial Services, Telecommunications, Intellectual Property Rights, State-Owned Enterprises and Designated Monopolies, the Environment, Small and Medium-Sized Enterprises Issues, North American Competitiveness, Good Regulatory Practices, and Private Commercial Disputes.
  5.  It is true that the deal added few restrictions such as the Rules of Origin and Origin Procedures, but these restrictions only add more to the manufacturing cost rather than protecting the consumer.
  6. The Democrats who were screaming against the USMCA and then voted in its favor would tell you that the newly added changes would help workers such as the $16 minimum for 40%-45% of the manufactured parts. But a closer look will reveal that these wages include engineers and other high paid positions that are already paid $16 per hour. This rule might help workers in Mexico if and only if it gets enforced.
  7. USMCA rules will further the domination of internet monopolies like Google, Facebook, and Amazon. The USMCA’s new provisions will limit the ability of countries to regulate these giants and the internet itself.
  8. USMCA contains a “China clause” that allows any of the three USMCA members to a veto trade deal with China by another member. This continues the trade-war policies of Trump’s tariffs and Obama’s proposed Trans-Pacific Partnership (TPP).

9. Top White House officials misread the USITC report when they tout the USMCA as boosting US growth by 0.3 percent per year. In fact, the study estimates that on balance the market access provisions of the USMCA would restrict trade and cause US growth to decline by 0.12 percent.