Congressional Hearing on Mexican Labor Reform Illustrates USMCA Challenges

Jun 26 2019 |
A worker in a Mexican warehouse. | Getty Images

Dems say there’s more work to do.

In the past few weeks, China trade talks have dominated the headlines as fears of escalating trade tensions increase. What may slip through the cracks, meanwhile, is the ongoing debate over a new trade deal to replace NAFTA and improve this continent’s economic prosperity.

Will Congress pass the deal the Trump administration negotiated with Canada and Mexico? Capitol Hill has a lot of outstanding questions about it. And a recent hearing in the House Ways and Means Subcommittee on Trade brought forth experts on Mexican labor to discuss some of them.

Both sides of the aisle voiced their desire to see improvement in Mexican labor rights through the reforms committed to by the Mexican government in the U.S.-Mexico-Canada Agreement (USMCA). Ranking member Rep. Vern Buchanan (R-FL) said that the Mexican government has already acted on USMCA and passed what he believes is “a watershed labor reform that will overhaul its system of labor justice and create better conditions for its workers.”

“Many of Mexico’s fiercest labor critics have welcomed this landmark new law,” he said. But Chairman Rep. Earl Blumenauer (D-OR) said there was more work to do on this deal to ensure Mexico’s promised reforms are effective. “If we were to pass (this) agreement in its current form, we would basically have to take Mexico at its word or rely on a broken state-to-state dispute settlement mechanism that hasn’t been effective where the U.S. government has used it, and that has never been used to enforce labor obligations,” he remarked.

Indeed, Democrats say they’re still concerned about enforcement of labor reform and that monitoring Mexico’s implementation is a top priority. The expert witnesses at Tuesday’s hearing noted the persistently low wages for Mexican laborers, and the challenge of improving legitimate worker representation in unions there. Unions in Mexico are often used just to benefit employers, and labor organizers face the threat of violence. One witness, Gladys Cisneros from the Solidarity Center, explained how some companies hire violent “goons” to stop employees from challenging their higher-ups.

It is critical to understand that Mexico's stubbornly low wages are the intentional outcome of policy and practice. They're enforced by an industrial relations system that denies Mexican workers their right to freedom of association, and robs them of their ability to demand better pay and better working conditions. Gladys Cisneros, Solidary Center Mexico Director 

While Mexican workers are paid approximately a tenth of what American workers make, lawmakers expressed hope a trade deal with better, and enforceable, labor standards could move towards a more level playing field between these two countries – raising wages in both countries in the process.

These concerns would indicate substantive changes are still necessary before House Democrats are willing to vote for the USMCA. Republicans are asking for a vote, but Democrats want to see improvements in labor and enforcement language, not to mention changes to language on a handful of other issues, before that happens.

The Trump administration aims to push it for approval this summer, but there is not a clearly established timeline due to concern over enforcement tools, labor and environmental protections, Mexico’s availability of resources to complete the reform, and – of course – the continuing threat of President Trump’s 5% tariff on Mexican imports that he raised over immigration demands.

This post was prepared by AAM interns Isabel Hayes, Joseph Swindal and Luke Ferguson.