August 2010, Week 1


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Portside Labor <[log in to unmask]>
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Wed, 4 Aug 2010 21:19:08 -0400
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U.S. Files Historic Labor Complaint Against Guatemala
August 4
3:24 pm
By Akito Yoshikane

President Obama's pledges to sign free trade deals have
been strongly opposed by labor unions. But recently, his
administration slightly appeased his critics by
enforcing workers' rights agreements in an existing
trade pact.

Last Friday, the United States filed a complaint against
Guatemala for failure to enforce labor agreements
outlined in a free trade deal with Central American
countries, making it the first time the U.S. has brought
a case against a trade partner. 

The U.S. conducted an 11 month examination and found
Guatemala did not uphold their obligations to ensure the
freedom of assembly, right to collective bargaining,
right to organize and decent work conditions. Ron Kirk,
the United States trade representative, made the
announcement in front of steelworkers in Pennsylvania.
Kirk said that the violations made it difficult for
American workers and businesses to stay competitive as a
result of declining labor standards.
"With this case, we are sending a strong message that
our trading partners must protect their own workers,
that the Obama administration will not tolerate labor
violations that place U.S. workers at a disadvantage,
and that we are prepared to enforce the full spectrum of
American trade rights from labor to the environment," he
The decision was welcomed by labor unions from both
countries. The AFL-CIO and United Steel Workers both
expressed support. Guatemala's agro-industrial union
called the measure "a first step" to improving labor

The complaint, while historic, still works within the
existing framework of the neoliberal trade agreement,
which unions, including the AFL-CIO have historically
opposed. Labor groups say the free-trade agreements send
manufacturing jobs abroad, often to countries where
labor laws are not properly enforced. They add that the
agreements do little to increase living standards. 

Economists have had a wide range of opinions on whether
free trade deals like NAFTA contribute to American job
losses. Politically, it has been a contentious issue
among Democrats and unions. The trade pact with Central
American states, officially called Dominican
Republic-Central America-United States Free Trade
Agreement (CAFTA-DR), was able to inch past Congress
under President George W. Bush. 

The U.S. claim against Guatemala was also similar to
what unions did two years ago. In April 2008, the
AFL-CIO and six Guatemalan unions filed a case to the
United States labor department accusing Guatemala of
violating labor laws. Guatemala has been one of the
worlds most hostile areas for unions. The latest annual
survey by the International Trade Union Confederation
found that the country had the second highest murder
rate of labor leaders. Sixteen labor leaders were killed
in 2009.

The United States will consult with Guatemala to resolve
the issue. If the dispute heads into an arbitration
panel, a ruling against Guatemala can lead to fines
totaling $15 million. 

The decision to enforce labor protections now is timely.
Obama has proposed to stimulate the economy through a
free trade agenda that aims to double exports over five
years. Obama has sought to sign deals with South Korea,
Colombia and Panama that have been stalled in Congress.

The measure is seen as a gesture to Democrats and labor
groups who have opposed CAFTA and similar agreements.
Democrats applauded the action to file suit against
Guatemala, probably a move by President Obama to build
political consensus around free trade. With elections
just around the corner, setting up the announcement in a
union heavy state like Pennsylvania also appeals to
gaining labor's support.

Democrats like Representative Sandy Levin of Michigan
applauded the decision, adding that the CAFTA agreement
signed by former president Bush did not include strong
international labor standards. It will be interesting to
see how Democrats, the AFL-CIO and other labor unions
will react to any potential trade deals in the future.
That is, will they continue to work within the free
trade deals by lobbying to enforce labor rights, or will
they continue to oppose the entire framework as they
have in the past?

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