Under Threat: New Trade Deals and Public Sector Workers

Under Threat: New Trade Deals and Public Sector Workers

(June 2003)

Prepared for the

By the Resource Center of the Americas & Labor Education Service, University of MNMinnesota Fair Trade CoalitionMinnesota Fair Trade Coalition

Manufacturing Jobs Lost … Manufacturing Jobs Lost …

• 3,000,000 manufacturing jobs lost to free trade since 1994

• Over 750,000 jobs lost under NAFTA alone

Free Trade Agreements once affected mostly manufacturing jobs.

Sweatshops-R-Us Globalization Sweatshops-R-Us Globalization • Many jobs sent to poor

countries

• Work often done under sweatshop conditions

• Workers often denied unions and basic human rights

Free Trade in Services Free Trade in Services

• International trade no longer targets just manufactured goods

• Now corporate free traders are going after services – including public services

New Trade Deals and Public Workers New Trade Deals and Public Workers

• Negotiations are underway on GATS (General Agreement on Trade in Services)

and FTAA (Free Trade Area of the Americas)

• These agreements could:– mandate privatization of government

services– undermine union wages and jobs– threaten government safety, human

rights, and environmental protections

GATS (General Agreement on Trade in Services)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

“Multinational agreements, like the North American Free Trade Agreement (NAFTA) and the General Agreement on Trade in Services (GATS) are slowly taking the decision whether or not to privatize out of the hands of state and local government officials and giving wide-ranging powers to private corporations.”

-- Continuing the Fight Against PrivatizationResolution passed at AFSCME’s 35th International Convention, June 2002

FTAA (Free Trade Area of the Americas) 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

GATS, FTAA and Public EmployeesGATS, FTAA and Public Employees

• Could require many public services to be opened to bid by private foreign companies

• Public employees would have to compete to try to keep their own jobs

So,So,What public services are targeted?

What public services are targeted?

Water ServicesWater Services

• Water collection, purification and distribution

• Waste-water treatment

Many of these services are now provided by municipal water districts and staffed with union public employees

This continues a corporate push to control water supplies

This continues a corporate push to control water supplies

The World Bankestimates a fully-privatized global water market is worth $800 billion a year

Rebecca Mark, former CEO of Enron’s Water Division, said she would not rest until she had:

“fully privatized the global water market.”

Enron worked closely with the Bush administration to define U.S. goals for GATS

Surprise …Surprise …

Waste Management ServicesWaste Management Services

• Waste management is also targeted under GATS

GATS will likely allow foreign firms to bid on municipal sanitation and incineration work – areas already under heavy pressure from privatization.

Air and Water Protection ServicesAir and Water Protection Services

• Protection of ambient air and climate

GATS will likely allow foreign firms to bid on the work currently done by the U.S. Environmental Protection Agency (EPA), state Pollution Control Agencies (PCAs), perhaps even OSHA.

Environmental Protection ServicesEnvironmental Protection Services

• Protection of biodiversity and landscape

GATS targets for privatization services that include work done currently by the National Parks Administration, U.S. Forest Service, Bureau of Land Management, and state Departments of Natural Resources

Transportation ServicesTransportation Services

• Urban mass transit and other transportation services

GATS could allow foreign firms to bid on mass transit services – buses, trains, metro mobility, etc.

It may even include school bus transportation.

Education ServicesEducation Services

• Higher education, adult education and various training services

Currently negotiations are underway to cover all education beyond secondary school.

More services could be targetedMore services could be targeted

• GATS is re-negotiated every few years – this means more new services can be added

• Once a service is opened to free trade it is almost impossible to limit it again

• FTAA will likely cover even more services

Hypothetical Case – Water ServicesHypothetical Case – Water Services

• Assume GATS rules are already in place

This is how privatization would work under the new trade agreements …

A couple of years ago,

U.S. Filter (which controlled New Orleans’ sewer system) tried to take control of its water system.

Citizens fought back.• A strong coalition wins -- the New

Orleans Water and Sewerage Board rejects U.S. Filter’s bid.

• The coalition secures a requirement that any future privatization effort must be put to a public referendum.

But …

SEIU Local 100 …

… helps win the fight … and organizes the sewer and water workers.

One day,

a few months after the new GATS takes effect in 2006, the City of New Orleans receives a letter …

… from U.S. Filter …

… a division of Vivendi.

… is a French-based multi-national corporation and one of the world’s largest private water companies.

Vivendi …

Dear City of New Orleans:

You are obliged under the provisions of

GATS to consider U.S. Filter’s bid to

operate the New Orleans water system.

This decision cannot be put to a citizen

referendum.

Very truly yours,

Vivendi

The letter says,

New Orleans seeks help.It asks for an opinion from the U.S. Trade Representative’s Office.

The U.S. Trade Representative replies:

• New Orleans must allow U.S. Filter to bid.

• If they refuse, the U.S. must use all means at its disposal to force compliance – or else face huge penalties.

New Orleans complies.• Both U.S. Filter and SEIU Local 100 submit

bids.

• US Filter’s is the low bid – under GATS New Orleans must accept it.

• US Filter takes over, fires the union employees, and brings in its own employees.

This was fiction.But if GATS rules are adopted as currently envisioned, this fiction could become all too real.

In the 1990s the corporate free-traders went after industrial workers.

Now they are coming after public sector and construction workers.

What can be done?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

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 x19

lweiss@americas.org