By on December 28, 2017

Jerry Dias, Unifor President, Image: OFL Communications Department (Flickr) [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons

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)]

Get the latest TTAC e-Newsletter!

Recommended

35 Comments on “Union Boss Reassures Everyone That NAFTA Is Toast...”


  • avatar
    YeOldeMobile

    “Nobody in Canada and Mexico wants to throw [Donald Trump] a victory party,” Dias said. “He’s inherently unpopular…”

    So basically, it really came down to Trudeau and Nieto never wanted to renegotiate NAFTA and were not serious about it from the start because they hate our President.

    Fine. Let NAFTA fall and let the economy go where it may. Imagine what happens to Mexico when the US starts putting duties of 50% on agricultural products shipped in from Mexican farms. Many somebodies are going to lose a lot of money and they’ll howl up a storm asking for something new to be instated, and it’ll probably be substantially different from NAFTA. If that happens, I’d count it as a win for Trump.

    • 0 avatar
      sutherland555

      Right….it has nothing to do with the Trump administration’s stand on NAFTA and presenting poison pill proposals that they know Canada and Mexico have publicly stated are unacceptable. We want a deal but we’re not going to roll over and accept a bad one. Trump’s negotiating in bad faith. Trade is a mutually beneficial thing, every country involved has to (in general) benefit from this deal. Just because the US is the big boy, doesn’t mean we have to accept your country’s table scraps.

      And before you go accusing me hating on Trump (which I do, he’s a bloody disgrace), American business leaders have made it very clear NAFTA is beneficial and want an updated deal made.

      http://www.mcclatchydc.com/news/politics-government/white-house/article177955786.html

      • 0 avatar
        YeOldeMobile

        Nothing is non-negotiable. Saying something is a “poison pill” doesn’t actually mean it’s not something that can be changed or altered, or that there aren’t other places where they’d be willing to give ground. The Freudian slip though is very telling because it boils it all down to they didn’t like Trump. If Obama had asked in his way for a renegotiation and done almost nothing the change NAFTA, they would’ve worked with him.

        The second point I make is that, yes, there are people who say NAFTA is beneficial. So let this version of it die. The next one to come up will face entrenched resistance from all the voters who lost out the first time around and it will be a fairer trade agreement.

    • 0 avatar
      Astigmatism

      “So basically, it really came down to Trudeau and Nieto never wanted to renegotiate NAFTA and were not serious about it from the start because they hate our President.”

      Um, no, it came down to Trudeau and Nieto never wanted to renegotiate NAFTA and were not serious about it from the start because they don’t see any reason to renegotiate the deal the countries agreed on and have been living under for decades just because Donald Trump promised his supporters that he would.

      If your bank came to you and said they wanted to renegotiate your mortgage because the loan officer thought it would make him look good to his boss, would you seriously engage them in discussions, or tell them to STFU?

      • 0 avatar
        YeOldeMobile

        One of the reasons Trump got so much support through the Rust Belt despite their history of voting Democrat was because he promised to renegotiate NAFTA. The more apt analogy would be that the shareholders of a company revolted against a board for failing to provide a decent return and elected new board members who publicly stated they would refinance the company’s debt and negotiate with suppliers for credit terms in order to stabilize their short-term finances while promising long-term gains.

        • 0 avatar
          DearS

          $2/hr is pretty bad for wages. China has higher wages. That needs to go up in Mexico to help everyone and be more competitive.

          • 0 avatar
            Big Al from Oz

            DearS,
            The average Mexican auto worker (wage), who works for one of the Big 3 is over $8 an hour. Higher I might add than the US minimum wage.

            So, a Big Three Mexican auto worker is paid more tha 20% of US workers.

            Don’t listen or believe some of the crap put in the sites.

        • 0 avatar
          ra_pro

          I bet you Drumpf wouldn’t even understand what you are talking about, you use a very complicated language. And besides the are numerous studies showing that average Drumpf voter didn’t vote by their wallet but for their tribe. How can a self-proclaimed billionaire be in the same tribe as a poor Appalachian coal miner ouf of a job? Well, the tribe is defined by its values (or in this case the lack of them) Bible, guns, pussy, hatred of nigge’s and foreigners. “stabilize their short-term finances” that’s just laughable.

  • avatar
    stirner

    What happens when you go to the grocery store and realize YOU have to pay 50% more for food?

    • 0 avatar
      Jeremiah Mckenna

      Nothing because I don’t buy food labeled from Mexico. I don’t need to have fruits and vegetables from Mexico all year long, I can do without just like I did when I was young and lived on farm and would either do without or get food from the cannery or freezer in the basement. I don’t want to eat food that has been raised with the water from Mexico. What is the number one thing they tell you NOT to do in Mexico? Drink the water. Why? Because it is full of harmful bacteria and toxins.

    • 0 avatar
      Garrett

      I’d be happy with that outcome.

      It would give American farmers room to be more profitable, and help make it possible for wages to increase for farm workers.

      If you look at food expenditures as a percentage of total household income, it’s significantly decreased over the past 50 years.

      Food is cheap. Perhaps too cheap.

      • 0 avatar
        stirner

        You may be fine with a 50% increase but what about the 76% of people living paycheck to paycheck (look it up)?

        • 0 avatar
          DearS

          Exactly.

          Most people make less than $15/hour or about $1800/month for expenses.
          $900/rent
          $200/Car
          $200/Car Insurance + Gas
          $400/Food
          $50/Phone
          $200/Utilities
          $50/ Clothing
          Total$ 2000 and I’m not counting sick time/vacation, car repairs/tax, cost of a phone, appliances, household items, toothpaste etc.

  • avatar
    thegamper

    We buy more from Mexico and Canada than they buy from us, but without crunching the numbers, I suspect the current account deficit is rather small compared to the total dollar amount of trade between the 3 countries. Im not an economist, but think it is probably foolish to believe that jobs come back to the US as a result of NAFTA breakdown. In the short term, probably bad for American corporations who will not realize the expected return on investment in Canada and Mexico. Maybe marginally better for American workers in long term but who really knows.

    • 0 avatar
      stuntmonkey

      > Maybe marginally better for American workers in long term but who really knows.

      I highly suspect not, at least if we take a really long term view of things.

      The reason why free trade exists is because tariffs are a “beggar thy neighbour solution”… in the end, tariffs are a way of ‘exporting’ unemployment to another country. If everybody does it then you have a tragedy of the commons situation. Key question is that can you re-patriot jobs and reduce production costs? The answer according to the textbooks ought to be no, as the key function of trade is to let trading partners operate at their relative economic advantages.

  • avatar
    stingray65

    That $2 per hour Mexican labor is what makes it in the Union’s interest to kill NAFTA. Union’s have no leverage to raise membership wages when employers can move more work to much cheaper locations, and with no ability to raise wages the workers increasingly realize they aren’t getting anything back from their union dues except forced campaign contributions to the Democrats.

    • 0 avatar
      Southern Perspective

      Just for the sake of accurate comparison:

      American automakers pay Mexican workers $8 to $10 per hour, including benefits. Even among the Detroit Three, there is a gap, according to the CAR: GM’s labor costs average $58 per hour, while Ford is at $57 per hour and FCA workers average $48. That difference is partly because FCA has more workers earning the lower, entry-level wage.

      https://www.reuters.com/article/autos-uaw-mexico/corrected-u-s-autoworkers-face-threat-as-car-makers-drawn-to-mexico-idUSL2N0WR1KX20150326

    • 0 avatar
      Southern Perspective

      Addedenda:

      The average household (3.8 persons) has an income, in pesos of course, equivalent to about 900 USD a month. Automobile factories are not, relatively speaking, high income jobs as in USA. The high income jobs are more to be found in the public sector. Legal clerks, statisticians, and high-level educators.

  • avatar
    mikey

    As a Canadian, I think the time has come to put this whole ” renegotiate NAFTA” charade to bed. To prolong this isn’t helping any of us.

    If the three countries can sit down and negotiate a deal, lets do it. If President Trump wants to dump NAFTA, then we suck that up, and move on. It seems that Canada’s position, and the USA’s position at this time, are miles apart. Right , so we can’t make a deal?. I would suggest we shake hands, with Mexico, and the USA, and walk from the table. Leave as friends that agree to disagree.

  • avatar
    Gardiner Westbound

    Ross Perot, a 1992 U.S. presidential candidate, famously warned NAFTA would create a “giant sucking sound” by vacuuming away American (and Canadian) jobs to Mexico. It did impoverishing millions of factory workers. The U.S. is now driven by plutocrats and money changers who produce nothing. Trump is addressing a corrupt political system that has been incapable of producing a plan to deal with it nor mustering the will to carry one out.

    Canada’s “progressive” government is long on posturing and short on get things that really matter done.

    • 0 avatar
      Jeremiah Mckenna

      Finally, someone that understands what is at stake here.

      NAFTA can work for all three countries, but there needs to be level headed men and women in the negotiations, not a bunch of posturing and pumped up chests that are in there for political reasons.

      • 0 avatar
        Tele Vision

        And without a trust-fund baby/one-time drama teacher/rafting instructor doing the bidding of the Liberal back-room boys. Replete with several thousand ‘Uh’s.

        e.g. “I, uh, don’t really, uh, know what I’m, uh, doing.”

  • avatar
    RRocket

    I’ve lived near the city where the CAW/Unifor’s spiritual headquarters is, so they’ve always been in the news here and a part of the social fabric as long as I can remember. I’ve always wondered when the workers would demand more from the CAW leadership. More qualification than “his dad worked for the union”, more education than “he’s a drop out”. Maybe in a bygone time when auto manufacturing merely extended from Michigan to Ontario, little qualification was needed to be a labor rabble rouser and leader. But manufacturing is global now and the issues more complex. Yet the leadership hasn’t evolved in step with the issues or become more progressive. It’s the same old thing here. And worse, the union seems to be more concerned with protecting wages rather than protecting jobs; these are very different things.

    As long as the union leadership continues to be a caricature of old school union leadership, I think union membership will continue to decline and jobs will continue to disappear.

    • 0 avatar
      Big Al from Oz

      RRocket,
      I really believe unions need to reassess what is needed. I empathise with people who are having their jobs exported or automated. The reality is most saw this coming years in advance. Most workers just doesn’t rock up to work and are told, “Oh, by the way your fired”.

      The worker had opportunity to “restructure”. Business is the same.

      Unions need to embrace changes for the future whilst being realistic. Business need to be more transparent.

      My belief is the consumer side is where we should be vigilant, but we have it assup and want to protect production.

      The consumption side, ie the customer, any customer needs to be supported. The production side ie, business/workers doesn’t need support.

      All workers need is a basic livable income, health and education.

      A consumption biased system will create more jobs, oppotunities and progress. Import tariffs, barriers, etc and any anti trade controls stiffles progress.

  • avatar
    Big Al from Oz

    Its not fair is what I read in some comments.

    How is it not fair? I think you’ll find there were opportunities for the US to advance itself.

    But it appears some of the anti NAFTA guys are the same ones who complain about paying more taxes to educate people fix roads, healthcare, etc.

    You know what? Maybe instead of complaining that its not fair get off your ass and take a gamble to improve America. Contribute.

    People, manufacturing as we have known it is passe, a service economy is what’s it about. Have a look at how huge the export of US service industries are. So give me a break!

    Cheap labour and/or robotis/AI is the future, not some blue collar dude who quit school at 16. All he’ll have as a job in the future is working a checkout or as a maid in a hotel. In other words employing the same or similar skillsets he learnt through his/her life in the service sector.

    Get used to it. Whilst countries have great disparity, ie, the US, the economy of the future is grimmer than needs be.

    Gibing yourself a handicap to win is not the way to go.

    To you xenophobics, its just easier to blame others. How can it be otherwise.

    • 0 avatar
      psarhjinian

      “Cheap labour and/or robotis/AI is the future,”

      So instead of McJobs, we get UberJobs. That’s just fantastic.

      I don’t think the wealthy realize that this kind of rampant exploitation of populism without actually doing anything for the populace is what gets you Huge Chavez. Trump isn’t Chavez—quite the opposite—but he’s laying the groundwork.

      • 0 avatar
        Big Al from Oz

        Psarhjinian,
        Well that is the future. 150 years ago there were people like you who stated machines and mass production would be the end of it. The future is the same.

        Most consumer goods will and are cheaper than they were 30 years ago.

        There have always been shjt jobs. Not all can be a tech, let alone a rocket scientist. Its up to the US voter to elect and choose their future.

        Many in the US are whining like the Europeans did when the US copied and improved mass production. Now the shoe is on the other foot.

    • 0 avatar
      Superdessucke

      How come Germany has a strong auto industry?

      • 0 avatar
        Big Al from Oz

        Because the Germans cater to the global market, as do the Japanese and Koreans.

        The US caters to itself via the use of regulatory controls and tariffs an example is pickups and their derivitive SUVs. That’s all the US really has, and guess what? The global market doesn’t want many of them.

        So, as I’ve been stating for years now the US needs to restructure the way its auto industry operates.

        Then the US must produce competitive products, oncluding improving quality.

  • avatar
    jacob_coulter

    Trump campaigned on ending NAFTA and won on that position in states that rely heavily on manufacturing. So if NAFTA ends, to me it looks like democracy in action.

    Will be interesting to see the Democrat nominee in 2020 running on reinstating NAFTA and how that will go over with rank and file union members.

  • avatar
    ra_pro

    Exactly, Drumpf wants to end NAFTA. Why doesn’t he, why the charade and posturing about renegotiation?

  • avatar
    RS

    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.

  • avatar
    Arthur Dailey

    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.


Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • Corey Lewis: It was dark back there and I was more tired than anything. I did scoot too far back though. Nobody...
  • ajla: @Dan: I think every TTAC commenter has replaced their vehicle in the past 20 months so you pretty much have to...
  • ajla: 0. What kind of Continentals? 1. What octane are you planning to use?
  • SuperCarEnthusiast: No! They hate Tesla as a company!
  • Rocket: Panasonic, yes, but with completely different technology. Plus, Panasonic seems to be an unhappy partner in...

New Car Research

Get a Free Dealer Quote

Staff

  • Contributors

  • Timothy Cain, Canada
  • Matthew Guy, Canada
  • Ronnie Schreiber, United States
  • Bozi Tatarevic, United States
  • Chris Tonn, United States
  • Corey Lewis, United States
  • Mark Baruth, United States
  • Moderators

  • Adam Tonge, United States
  • Corey Lewis, United States