- Associated Press - Thursday, December 9, 2010

The nation’s largest labor federation said Thursday that it will oppose the free-trade deal between the Obama administration and South Korea, a stance that could complicate efforts to get the support of organized labor’s Democratic backers in Congress.

The decision, announced by AFL-CIO President Richard Trumka, marks a break with the United Auto Workers union, an AFL-CIO affiliate that agreed to support the deal after negotiators took steps to address South Korea’s big trade surplus in automobiles.

Mr. Trumka said the deal reached last week does not do enough to address concerns about the outsourcing of American jobs, the enforcement of tariff provisions or the potential problem of currency manipulation.

“We’ve seen U.S. multinational companies take advantage of the investment and other corporate protections in past trade deals to shift production offshore, while maintaining access to the U.S. consumer market and undermining the jobs, wages and bargaining power of American workers,” Mr. Trumka said in a written statement.

The Obama administration hopes the deal will create tens of thousands of jobs and boost U.S. exports. The agreement would be the largest U.S. trade deal since the 1994 North American Free Trade Agreement.

Under the agreement, the U.S would lift its 2.5 percent tariff on Korean cars in five years, instead of cutting the tariff immediately. South Korea would have to eliminate its 10 percent tariff on U.S. trucks immediately, but the U.S. could continue assessing a 25 percent tariff on Korean trucks for eight years and then phase it out by the 10th year.

Each U.S. automaker could export up to 25,000 cars to South Korea each year, so long as they meet federal safety standards. If a U.S. automaker exports more than 25,000 cars, the deal would allow the company to comply cost-effectively with South Korean safety standards.

While labor’s clout over the past decade has declined along with its membership, unions provide crucial political and financial support to many congressional Democrats. Unified opposition from labor has succeeded in the past in blocking other foreign trade deals.

White House spokeswoman Jen Psaki said labor unions have always been a part of the bargaining process and that the president aimed to get the best deal for American workers and businesses.

“The support of certain unions, including the United Autoworkers, plus Ford Motor Co., Democrats and Republicans and a broad group of business leaders has shown he made the right choice and that the final deal does just that,” Ms. Psaki said.

The administration has won the backing of Rep. Sander M. Levin, Michigan Democrat and acting chairman of the House Ways and Means Committee, as well as Mr. Levin’s successor next month when Republicans take control of the House, Rep. Dave Camp of Michigan.

Rep. George Miller, California Democrat and chairman of the House Education and Labor Committee, said the terms of the deal “do not go far enough to make this treaty worthy of support.”

“The protections for labor standards are too weak and the procedure for policing violations retains a failed model that has not produced a single fine for labor violations in any of the treaties since NAFTA,” Miller said in a statement released Thursday.

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