The North American Free Trade Agreement (NAFTA) between the United States, Canada and Mexico has cost more than 1 million jobs in this country and Canada, cut the wages of Mexican workers by 25 percent or more and spurred the development of Mexican maquiladora plants where workers’ rights are trampled and toxic waste is spewed into communities and waterways.

The Free Trade Area of the Americas (FTAA) treaty is a near-clone of NAFTA and would spread NAFTA-like affects to 34 countries in the Northern and Southern hemispheres.

But NAFTA’s negatives appear to be of little concern to the leaders of those nations now shaping the proposed trade deal. In fact, they say NAFTA is their model. It is a seriously flawed model.

“NAFTA’s main outcome has been to strengthen the clout and bargaining power of multinational corporations, to limit the scope of governments to regulate in the public interest and to force workers into more direct competition with each other—reinforcing the downward pressure on their living standards, while assuring them fewer rights and protections,” the AFL-CIO Executive Council noted at its February 2001 meeting.

New reports on NAFTA’s impact on jobs and its contribution to the erosion of workers’ rights are frightening previews of what is in store if the trade deal is expanded more than tenfold by the adoption of the FTAA.

The Economic Policy Institute study, NAFTA at Seven, reports that the United States has lost 766,030 jobs, while Canada has seen 276,000 jobs disappear as result of NAFTA. In addition, this country’s NAFTA-related trade deficit and the deal’s trade rules have put downward pressure on the wages of noncollege educated workers in the United States, about 73 percent of the workforce, EPI reports. There are three reasons: Displaced manufacturing workers have moved to the service sector where wages average 23 percent less, the service sector labor supply has grown and is driving down wages and, EPI says, “Employers have used their new freedom to move across borders as a tool in collective bargaining by threatening to close plants.”

Mexican workers have suffered under NAFTA also. EPI says that while the number of jobs in the maquiladora plants, which make products once manufactured in the United States and Canada, have grown, “wages, benefits and workers’ rights are deliberately suppressed in maquiladoras.”

Throughout Mexico, NAFTA’s promises have been unfulfilled, the study reports—wages have dropped 21 percent for manufacturing workers and 25 percent for salaried workers, incomes of the self-employed have fallen by 40 percent and the purchasing power of the Mexican minimum wage has dropped by nearly half.

Workers have not suffered just economically under NAFTA. The group Human Rights Watch slams the United States, Canada and Mexico for ignoring “critically important labor rights obligations under NAFTA.”

Alarmingly, the FTAA treaty does not include even the minimal workers’ rights protections found in NAFTA’s Labor Side Agreement. That agreement includes 11 “labor principles” such as freedom of association, freedom from discrimination and a minimum wage.

The Human Rights Watch report, Trading Away Rights: The Unfulfilled Promise of NAFTA’s Labor Side Agreement, explores the many workers’ complaints filed, such as firing workers for organizing, denial of collective bargaining, life threatening health and safety conditions and more. It found that not one of the complaints filed has resulted in any sanction against an alleged labor rights violator.

“These three countries have actually worked to minimize the impact of the labor provisions,” said Jose Miguel Vivanco, executive director of the Americas division of Human Rights Watch.     

Even if FTAA negotiators agree on some workers’ rights provisions, something the Bush administration opposes, “labor agreements will never work without the active support of the countries involved,” Vivanco said.

Also, like NAFTA, the FTAA gives corporations the right to challenge a nation’s laws in secret tribunals and demand government compensation. FTAA puts more limits than even NAFTA on how governments can provide and regulate services in the public interest.

“Any wider free trade agreement that does not give as much priority to labor and social development as it gives to the protections of investors and financiers is not viable,” said EPI President Jeff Faux. “Rather than attempting to spread a deeply flawed agreement to all of the America’s, the leaders of the nations…need to return to the drawing board and design a model of economic integration that works for the continents’ working people.”

Report on NAFTA
Find out how working families are battling the FTAA. Read the AFL-CIO’s Executive Council statement on the FTAA. 
Download an AFL-CIO report on the FTAA.
Find out about the global campaign to post the ILO poster on fundamental rights at work.
Learn how to help make the global economy work for working families.
Find the EPI report, NAFTA at Seven, at www.epinet.org.
Visit Human Rights Watch to read about the failure of NAFTA’s labor protections.
Join the Working Families e-Activist Network for action alerts!