Thank you, Philip [Vaughn], for your generous words of introduction. I’m honored to be here.
Two years ago, when I last spoke to this group, the world economic picture made some people hopeful. Just a few months ago, even, some people said we were leaving the crisis behind. Unemployment had come down, young people were finding their first jobs, the stock market rose… housing prices grew.
Yet I would say we are still living in a time of crisis. We have seen turmoil in recent weeks in capital markets all over the world. At the heart of this turmoil is a set of global economic rules that keep wages down and workers powerless. So, in China we see an economy built on low-wage exports that cannot make the transition toward wage-driven growth.
In the United States our economy, so different from China’s in so many ways, like China’s cannot grow because flat wages hold it back. In Europe, austerity and attacks on workers’ bargaining power in southern Europe have pushed the continent as a whole back toward recession.
Everything that follows—capital market bubbles, currency devaluations, massive trade deficits—are all about trying to paper over the failure of this low-wage model. This failure cannot be papered over. There is no way around it: Global economic rules that keep wages down and workers powerless has led to secular stagnation and economic and political instability.
As president of the Trade Union Advisory Committee to the OECD—the Organization for Economic Cooperation and Development—I represent the labor movement in global economic policy discussions. In forum after forum, I hear the same solution—austerity—being offered over and over again. Even though, our wages have been flat, and inequality is thriving, somehow regular people are to blame! Somehow the answer is to lower wages even more, undercut the rights of more working people and make inequality worse.
Look at Greece. The country has lurched from debt-crisis to debt-crisis, but instead of balancing spending cuts with debt-forgiveness, it’s been all-cuts, all the time. These cuts make life harder for regular people, while investors don’t feel any pinch. And that’s not all. Negotiators have gutted Greek labor law as part of the solution, too. In short, all these fixes have only made inequality worse, and workers are left with less leverage to bargain for raises when productivity rises.
We can dress up those bad moves with terms like “structural reforms” or “labor market flexibility,” but the end result doesn’t change. Life gets harder for people who count on a paycheck to live, and the investor class gets richer. And the basic measures of economic health—GDP growth, unemployment, wage levels—keep falling.
And yet a fresh and powerful vision for our global economy has been gaining ground. You can see it clearly in the teachings of Pope Francis. Later this month, His Holiness will bring his message to the United States—the message that each of us matters, that every one of us has value—and the public is ready to listen.
Ready to listen, and ready to act. Here in America we have already begun to chart a new course for ourselves. We’re demanding our politicians address economic inequality and its fundamental cause—income stagnation—in meaningful ways.
Our world today demands action. A top priority for the AFL-CIO and our global labor partners is to make a new set of rules for the global economy so work works for regular people. We see trade as key to setting those rules. Just look at how hard it was for President Obama to win Fast Track Trade Authority for the Trans-Pacific Partnership. We objected to Fast Track, because it doesn’t allow our elected officials to amend problematic parts of the proposed trade deal—and there were and are a lot of problematic parts of what the United States seems to be proposing in trade agreements like the Trans Pacific Partnership and the Transatlantic Trade and Investment Partnership.
For example, ISDS—the Investor-State Dispute Settlement provision—would give corporations the ability to hold for ransom laws passed by democratic governments. We’re concerned about a trade model that gives more rights to foreign corporations than to a country’s own people. We are concerned about any trade dealt that puts corporate profits over the health of families. That’s why we also continue to raise concerns about access to affordable medication for the world’s poor.
In the end, sure, Fast Track squeaked by, but our efforts have strengthened a strong new coalition extending from the labor movement to community and small business groups to Doctors Without Borders and Oxfam. And this summer, the TPP has all but stalled. Mark my words, we have forever changed the trade debate in America. It will never be the same. We built very real, very powerful momentum for a new America, and we’re not stopping.
Listen, this isn’t about being pro-trade or anti-trade. This is about what kind of trade works for workers in the United States, in Mexico, Vietnam and around the world. Can trade lead to jobs that are safer and pay more? Can trade increase productivity? Can wages rise along with those productivity gains? Will the people who do the work in the world’s economy share in the wealth we create?
The Fast Track debate also highlights the link between trade and migration. Around the world, millions of desperately poor workers are fleeing across borders in search of jobs and opportunity. Right now, we see migrants dying literally by the boatload in the Mediterranean Sea and by the truckload in Europe. It’s heartbreaking, and it’s only one example of the tragic effects of a worldwide race to the bottom. Listen to this: 27 million men, women and children—regular people just like you and me—have been trafficked and are today trapped in slavery.
During the Fast Track debate, proponents tried to turn a blind eye to the problem of forced labor and human trafficking in Malaysia and other countries. Well, that cat is out of the bag. We all know how Administration officials whitewashed the problems in Malaysia, once again allowing corporate profits to trample real people.
The public wants justice, not more of the same.
One of the most compelling voices for justice for people who risk danger in the search for a better life has been Pope Francis. Back in 2013, when the Holy Father made his very first trip outside Rome as the leader of the Catholic Church he met not with world leaders but with humble migrants. It was on a tiny rocky Italian island in the Mediterranean Sea, just 70 miles from Africa. He celebrated Mass and laid a wreath in the sea for the thousands of people who drown while trying to reach Europe.
Pope Francis has spoken beautifully about work. He said, “We do not get dignity from power or money or culture. We get dignity from work.”
These are powerful messages, and they require me—and us—to look at migration and human suffering and work as central parts the global economy.
When corporate entitlements are the goal of trade deals, working people suffer and die. The United States has a free trade agreement with Guatemala, which is one of the most dangerous places in the world for someone to try to form a union. The Bush White House made promises. International negotiators put forward the strongest labor commitments ever. And yet corporate thugs continue to murder working people, and no one even gets arrested.
I can’t mention Guatemala without acknowledging the way popular protests there led last week to the resignation of the president and his cabinet. We don’t yet know what will happen there, but it is clear that people want justice.
How can we embrace trade deals like the one with Guatemala? Who benefits? A handful of wealthy investors make more money, that’s all. It’s not worth it.
Work shouldn’t hurt or kill, but it does. Work hurts when factories collapse or catch fire. The workers at Rana Plaza in 2013 were earning only $35 a month making clothes for our markets when 1,200 of them died. Many more were injured and disabled.
All over the world, regular men and women lack basic justice and economic opportunity, in particular with the growth of on-demand employment. It’s time for a change. In the United States, we have seen men and women protest and win raises at Walmart and Target and Ikea. A movement has been growing to raise the federal minimum wage, and the Fight for $15 has brought fast food workers into the streets.
All this comes back to one of the basic points I want to leave you with today: America and frankly our entire world is at an inflection point.
What does it mean to be at an inflection point? It means we’re ready to go in a dramatically new direction. Trade is about the best place for us to start, as we rewrite the basic global economic rules.
I’d like to tell you what that new direction could look like.
Quite frankly, the trade talks on the Transatlantic Trade and Investment Partnership offer a place where we see the possibility of a high-road trade model.
This model could be consistent with the AFL-CIO’s larger economic goals, which we define as this thing called the Raising Wages Agenda. It’s our yard stick and our guide. All of our policy goals fall under it, and it’s about much more than just money. It’s about the ability for regular people to work for a better life. And that means holding corporations accountable for their supply chains. We don’t want multinational companies to continue creating an environment where disasters like the one at Rana Plaza happen.
You see, when you start looking at trade from the premise that the goal should be to make lives better for average people, a whole bunch of stuff that has become standard in corporate dominated trade agreements suddenly fall away, and other things get added.
ISDS falls away, and we see new provisions to hold cross-border investors accountable. We see ways to improve regulations for environmental protection, toy safety and migrant protection. We see ways to find and lift up best practices, to protect food safety and encourage investment in education and healthcare.
The rights of workers have to be at the center of trade agreements. For instance, it’s too dangerous to start a union when a government can jail you for political speech. That happens in too many places around the world—and in too many countries in the Trans-Pacific Partnership. We need freedom of speech and freedom of association to allow working people to safely organize unions and raise wages.
The TPP and the TTIP are incredibly important. They would create rules for 60% of the world economy. We need to understand they are more than trade deals—they are documents creating the rules for the global economy.
I’m somewhat optimistic with what I’ve seen on the trade deal with between the United States and the EU. It could build stronger standards. It could enhance workplace democracy and fair bargaining by giving workers more information about the financial condition and assets of employers. It could also require stronger rules on workplace safety and give temporary and contract workers more rights. At its best, TTIP could lead the way toward a new high-road trade model. Or it could be another corporate dominated trade deal.
Let me clearly say again: We are not anti-trade.
We would gladly embrace a good trade agreement. And we continue to hope that in light of the breakdown in the TPP talks that there will be some rethinking. We have said again and again that there are a set of key problems with TPP:
- Weak labor and environmental protections, particularly in the area of enforcement;
- No currency chapter;
- ISDS; and,
- No provisions on carbon emissions to match the U.S. efforts.
We are ready to dive in on these issues. And we are ready to hold our elected representatives—and those who seek to hold public office—accountable on trade.
A new model of global trade could and should lift wages and improve lives, and so usher in an era of stable, wage-driven growth and shared prosperity.
I doubt TPP will meet that standard. What we’ve seen so far is that U.S. negotiators don’t yet understand the new model. They’re stuck in the past with an out-of-date blueprint for failure.
We will continue to engage in negotiations to improve both of these agreements to make them acceptable. If that happens, great. If not, we’ll run campaigns to defeat them.
We will be ready, either way. Thank you. And God bless you. I look forward to your questions.