Clinton Plans Open Trade Door To Latin America, Irking Labor
After NAFTA, US seeks market pacts in Western Hemisphere
FIRST there was NAFTA. Then there was GATT. Now politicians, businessmen, and lobbyists are buzzing about the newest trade idea: tearing down barriers to commerce throughout the Western Hemisphere.
Secretary of Commerce Ron Brown says if the United States throws wide its doors, the emerging markets of Latin America could become ``a larger customer for US exports than Western Europe'' by the year 2000.
With the historic Summit of the Americas scheduled in Miami in December, Mr. Brown encourages all sides to put trade at the top of the agenda. Open trade, he says, would foster President Clinton's three major foreign policy goals for the Americas: democracy, investment, and economic growth.
The president, meanwhile, says the newly passed NAFTA (North American Free Trade Agreement) already is ``working superbly,'' and he urges Congress to implement the even-more sweeping, 117-nation GATT (General Agreement on Tariffs and Trade).
The hurrahs for free trade coming from the Clinton White House are deeply troubling to American labor unions, however. With trade barriers dropping around the globe, they see a grim picture: Jobs heading south. Wages falling. The US standard of living in decline.
This week, news from the Commerce Department reinforced labor's concerns. Government figures show investments by US firms in factories, retail outlets, and other businesses abroad have surged past $700 billion on a replacement basis. Many US firms now employ more people overseas than at home.
William Bywater, president of the International Union of Electronic, Electrical, Salaried, Machine, and Furniture Workers (IUE), told the Monitor: ``We're being clobbered. When they [the Clinton administration] talk about getting jobs, the jobs we're getting are hamburger jobs, not the jobs that really pay a decent wage.''
Lane Kirkland, president of the AFL-CIO, complains that real wages for many workers are already down by 20 percent over the past two decades. He charges that advocates of free trade facilitate efforts by US companies ``to roam the world in search of the cheapest and the most repressed labor they can find.''
Union leaders describe the long-term effects of free trade on the labor movement as devastating. Sal In-grassia, IUE district president in New York and New Jersey, says his own union, which once had 100,000 members, has slumped to less than 40,000 as jobs go elsewhere, mainly because of jobs going abroad.
Yet Clinton officials, often siding with big business against big labor, press ahead. One early possibility: a bilateral, free-trade deal with Chile as a way of opening the door to the rest of South America. Another, less likely prospect: an agreement by the US, Mexico, and Canada to welcome Chile into NAFTA.
Clinton says trade helps the US in the long term. GATT alone will create 500,000 high-wage US jobs by the end of this decade, he says. Brown insists that the opportunities for business are almost limitless. Recently, he told a House committee that two-way US and Latin America trade ``has more than doubled since 1983, from just $67 billion to nearly $153 billion last year. Latin America's 470 million people make up one of the two ... fastest growing export markets [for the US]. Since 1985, US exports to Latin America have generated 900,000 US jobs.''
Brown says: ``The bottom line is, American exports equal American jobs.''
What angers labor is that the White House seems to overlook another important equation: imports into America equal American job losses.
For instance, Mr. Clinton recently told the nation's governors meeting in Boston that, because of NAFTA, ``our trade to Mexico is growing more rapidly than with any other country. We have already sold five times more automobiles to Mexico this year than last year.''
Steve Beckman, an official with the United Auto Workers Union (UAW), says the president left out the other half of the story - surging imports from Mexico. US sales to Mexico of light vehicles, such as cars and vans, did grow from 1,919 in the first four months of 1993 to 11,538 in 1994. But, in the same period, Mexico exported 120,000 vehicles to the US, up from 104,000. So while US exports rose by 9,619, US imports from Mexico rose by 16,000, a net loss by the US of more than 6,000 vehicles since NAFTA.
AS US manufacturing jobs move to Mexico and other nations, Mr. Kirkland says, the greatest impact in the US falls on Americans least capable of handling change: ``Just about every major social problem we have today - from our soaring crime rate and the decay of our cities to rises of poverty and homelessness - can be traced to one factor: The decline ... of decent-paying, entry-level jobs to people of limited skills.''
Those jobs previously gave minorities and immigrants ``access to the ladder up into the middle class,'' Kirkland says. Entry jobs paid enough to raise families and send children to college, but ``many of those jobs ... have been exported to countries where working people toil long hours for rock-bottom wages.''