AFL-CIO President Richard Trumka gave the Trump administration a mixed review for its efforts to renegotiate the North American Free Trade Agreement, by saying the administration had made some good proposals but that it is still too early to tell because so little of the status of the negotiations is known.
Trumka also gave a qualified endorsement of the administration's push to renegotiate NAFTA's investor-state dispute settlement system, one of the most significant changes the White House is pursuing.
"Not enough was exposed for us to know if it is going to be real change or just tinkering and window dressing," Trumka said Wednesday during a breakfast hosted by the Christian Science Monitor when asked about the recently completed first round of NAFTA renegotiations. "I would give the overall grade as 'incomplete' because we just don't know enough yet whether is going to be real change or just more of the same."
Trumka nevertheless said there were "positive notes" that came out of the first round of talks, citing the proposed changes to the trilateral trade deal's chapters on dispute resolution as well as the rules governing state-owned enterprises. Asked about the administration's proposal to make participation in deal's investor-state dispute settlement system voluntary for nations, Trumka told the Washington Examiner this would be a "slight improvement" but added he would like to see the system abolished entirely instead.
Asked directly if he thought the administration's proposal to opt-out would be a good idea, Trumka replied, "That would be an improvement, yes."
NAFTA's investor-state dispute settlement system involves international panels of arbiters that adjudicate complaints between businesses and any of the three NAFTA governments, instead of having the nation's own courts hear the disputes. If a business thinks it has been harmed by a country's action, it can request that a tribunal is formed.
The business picks one arbiter, the country picks a second and they jointly agree on a third. The tribunal then presides over the case and issues a binding ruling much like a regular court.
Labor leaders like Trumka and other liberals have denounced the system and say it creates a special court system that heavily favors corporations. Business groups, by contrast, have said the system is crucial to ensuring international investment, arguing businesses need the reassurance that they can appeal a country's actions to a neutral court system.
U.S. Trade Representative Robert Lighthizer has proposed allowing the three NAFTA member countries, the U.S., Mexico, and Canada, to voluntarily opt to participate in the system. For example, should the U.S. opt out while Mexico opts in, that would mean a business could challenge a Mexican policy in front of an international tribunal but would have to go to American courts to challenge a U.S. policy.
The proposal has roiled the renegotiation talks. Business groups have urged the administration to drop the idea. A Canadian official with knowledge of the talks told the Washington Examiner their country would be a "hard no" on the idea. Liberal critics of the investor-state dispute system have remained largely quiet, apparently surprised by the administration's move.