Under Threat: New Trade Deals and Construction Workers

1
Under Threat New Trade Deals and Construction
Workers
(June 2003)
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Manufacturing Jobs Lost
Free Trade Agreements once affected mostly
manufacturing jobs.

• 3,000,000 manufacturing jobs lost to free trade
  since 1994
• Over 750,000 jobs lost under NAFTA alone

3
Sweatshops-R-Us Globalization

• Many jobs sent to poor countries
• Work often done under sweatshop conditions
• Workers often denied unions and basic human rights

4
Free Trade in Services

• International trade no longer targets just
  manufactured goods
• Now corporate free traders are going after
  services including construction jobs

5
New Trade Deals and Construction Workers

• Negotiations are underway on GATS (General
  Agreement on Trade in Services) and FTAA (Free
  Trade Area of the Americas)
• These agreements could
• undermine prevailing wage laws
• undermine union wages and jobs
• undermine project labor agreements

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FTAA (Free Trade Area of the Americas)

• FTAA extends NAFTA to 34 western hemisphere
  nations
• FTAA greatly expands coverage of NAFTA
• Negotiations aim to be done in 2004 -- voted on
  by Congress in 2005

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GATS (General Agreement on Trade in Services)

• Goal is to cover all services, all methods of
  delivering services, and every government measure
  at all levels affecting trade
• GATS is administered by the World Trade
  Organization (WTO)
• GATS covers 146 nations, including U.S.
• Negotiations aim to be done in 2004 -- voted on
  by Congress in 2005

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GATS, FTAA and Construction Workers

• Would restrict rules that are more burdensome
  than necessary for foreign companies
• Rules would have to be least trade restrictive
• Would prohibit government from setting conditions
  for awarding contracts except those necessary for
  product quality or supplier capability

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Prevailing wage threatened

• Would likely be judged more burdensome than
  necessary for foreign construction firms
• Prevailing wage laws could be attacked for going
  beyond what is necessary to ensure service
  quality or supplier capability

10
Project labor agreements threatened

• Agreements that require union labor could be
  prohibited
• Would likely be judged to go beyond what is
  necessary to ensure quality, or be the
  alternative that is least restrictive to trade

11
Temporary Foreign Workers

• New GATS rules will almost certainly make it
  easier to import temporary foreign construction
  workers

GATS negotiations are now addressing issues
that were previously considered to be untouchable
due to their political sensitivity (e.g. visa and
immigration procedures) -- high ranking WTO
official
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Indias Proposal

• Service workers (including construction workers)
  could work in other countries under GATS visas
• Companies would not even have to follow the
  countrys minimum wage laws
• WTO internal memo Indias proposal is getting
  serious attention from U.S., the European
  Union, and others

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GATS workers as indentured servants
As proposed

• GATS visa workers would have few rights or
  protections
• Workers who tried to form or join a union could
  find themselves fired or deported

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Hypothetical Case Twins Stadium

• Assume GATS rules are already in place

This is how prevailing wage could be affected
under the new trade agreements
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Assume GATS passes in 2005

• In 2006, the Minnesota Legislature gives 400
  million to build a new Twins Stadium
• Labor fights hard to win assurances that all work
  will be done under a project labor agreement

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Bids are put out,
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Bouygues

• Built the French World Cup soccer stadium in the
  1990s
• Is big, experienced, and politically
  well-connected

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Bouygues wins the low bid by 20.

• Their bid is the lowest because they plan on
  importing workers from their Chinese, Malaysian,
  and Philippine subsidiaries.

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Bouygues is the lowest bidder,

• because Bouygues plans to pay these imported
  workers less than 10 an hour
• -- far below wages in the U.S. but more than in
  their own country

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But wait
What about Minnesotas prevailing wage law?

• Minnesota requires prevailing wage on all state
  funded construction projects and the stadium bill
  ensured a project labor agreement

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Bouygues contacts its political friends,

• The European Union challenges Minnesotas
  prevailing wage law under the WTO
• The stadium is put on hold while the case is
  decided

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The case is heard by a WTO trade tribunal.

• They are unelected.
• They meet in secret.
• Representatives from Minnesota are present only
  if the federal government invites them

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The WTO finds against Minnesotas law.

• The tribunal rules that Minnesota cannot have a
  prevailing wage law under GATS
• The U.S. has only two choices
• Pay trade sanctions (400 million in this case)
• Use all means at its disposal to force Minnesota
  to repeal its law

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This was fiction.
But if GATS rules are adopted as currently
envisioned, this fiction could become all too
real.
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In the 1990s the corporate free-traders went
after industrial workers.
Now they are coming after construction and public
sector workers.
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What can be done?

• Build awareness
• educate your membership
• write opinion piece or letter to editor
• write article for local newsletter
• Contact Congress
• write Congress about specific issue
• encourage organization or local elected officials
  to contact Congress
• Make it an election issue
• put question on candidate screening
• talk to local elected officials about local
  impacts
• Mobilize people nationally
• prepare for November Miami rallies

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Join the Minnesota Fair Trade Coalition more
than 60 unions and allied groups fighting to
make respect for working people, family farmers,
our environment, and our democracy an integral
part of the global economy Contact Larry
Weiss612-276-0788 x19lweiss_at_americas.org