Union Boss Reassures Everyone That NAFTA Is Toast

Matt Posky
by Matt Posky

With everyone weighing in on the ultimate fate of the North American Free Trade Agreement, it almost seems as if we’re cataloging their bets to see just how right or wrong they’ll be in the negotiatory aftermath. Considering there has been such a limited amount of progress on the trade talks, there honestly isn’t much else to do.

Suggesting that NAFTA is “is going to blow up in 2018,” Jerry Dias, president of the Canadian union Unifor, has planted his flag on the side of a total breakdown of the agreement. Unifor represents 23,500 Detroit Three auto workers living north of the border, plus some 16,000 working in the supply chain.

As a union leader, Dias is prone to hyperbolic statements. However, his insight into the situation runs a little deeper than most.

“I’ve been having unfettered access to those who make the decisions, but I’ve also had a complete green light, understood and sanctioned by the government, to say whatever the heck I feel like,” Dias told Automotive News in an extended interview. “It’s not as if they’re going to change my mind. But they understand that bringing in labor as part of the team is quite helpful.”

As a consultant for Canadian officials, Dias has had multiple meetings with Foreign Affairs Minister Chrystia Freeland, chief negotiator Steve Verheul, and other Canadian representatives. “I’m convinced that unless Donald Trump folds, which he won’t, then NAFTA is gone,” he said. “I am probably going to win more wine in 2018 than anyone in the history of wineries because I have bet every journalist in Canada, Mexico and the U.S. that NAFTA would not be re-signed by the end of 2017. I have to put in a wine cellar in my condo.”

Dias cited the contentious regional content requirements being pushed by the United States as the primary sticking point for Canada and Mexico. The 85-percent North American content requirement proposal (which includes a 50-percent U.S. content mandate) for all vehicles imported into the U.S. has received serious criticism from both countries and even automakers. The labor head also said Canada’s $37-an-hour average wage couldn’t hope to compete with Mexico’s $2-dollar-an-hour mean.

He expects trade relations to revert to preexisting U.S.-Canada agreements and doesn’t feel any other outcome was ever a serious possibility. “If we signed NAFTA in 2018 with a five-year sunset clause, who is going to make a major investment in 2020 knowing that it can blow up in three years? Nobody believes the United States wants an agreement,” Dias recalled once telling U.S. Commerce Secretary Wilbur Ross. “Once Canada and Mexico got the indication that the United States wasn’t serious about an agreement, it’s all done.”

“Nobody in Canada and Mexico wants to throw [Donald Trump] a victory party,” Dias said. “He’s inherently unpopular. They think he’s dangerous and foolish. For [Canadian Prime Minister] Trudeau, who’s riding pretty high in the polls, to be perceived as folding to Trump is politically damaging.”

NAFTA negotiations resume January 23rd in Montreal.

[Image: OFL Communications Department/ Flickr ( CC BY 2.0)]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • RS RS on Dec 30, 2017

    It's ironic that Trump may give Unions more of what they want than any politician they've backed in the past 3 decades. I'll be surprised if NAFTA changes too much. US corporations have too much invested to see it dissolved. Anyone hoping he'll get big changes done could be disappointed. He'll push for minor changes that give the US more out of the deal and call it a win. His regulatory changes and tax reform may ultimately help unions and create more US jobs than changes to NAFTA.

  • Arthur Dailey Arthur Dailey on Jan 02, 2018

    Unfortunately those in power do not publicly address the many important behind the scene details and present only the views that their supporters wish to hear. Negotiating a free trade deal between developed first world nations (Canada and the USA) with strict environmental and pollution controls and a developing nation that does not have either of those or even 'the rule of law' (Mexico) is inherently unfair. Canadian and American workers cannot and should not be expected to compete against Mexican workers. Placing tariffs on imported Mexican produce would be a political disaster. Many of the regions in the USA that could produce this food are suffering from drought. The increased weekly food bills would create a political backlash. When calculating trade between Canada and the USA, is the flow of cash/value from American owned subsidiaries in Canada considered? I think not. Union leaders may be from the shop floor. But they employ highly educated and experienced economists and legal professionals to advice them. We are experiencing a seismic shift in work. Akin to the move from agriculture to manufacturing. The future of manufacturing is the European model. One highly paid 'technician' overseeing the work of multiple machines/robots, who have replaced five to ten human labourers.

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