Tai Tells AFL-CIO She is Negotiating on Steel Overcapacity, Touts Rapid Response Complaints

U.S. Trade Representative Katherine Tai told union members that steelworkers have faced unfair competition due to overcapacity, and that she'll be talking to her counterparts in Europe next week about how to create "new standards to combat the harmful industrial policies of China and other countries that undermine our ability to compete."

Tai, who spoke at AFL-CIO headquarters June 10, also said she'll be in intense negotiations to resolve the Boeing-Airbus dispute. "From my conversations so far, I am optimistic that we will be successful," she said. AFL-CIO President Richard Trumka called Tai a "champion of working people" in his introduction, and said she fought in the trenches for changes unions sought in the NAFTA rewrite.

Tai told the audience that the administration sided with the AFL-CIO to bring a Rapid Response complaint against auto parts company Tridonex in Matamoros, Mexico, and contrasted the first two rapid response complaints with the delays in responding to requests to initiate labor disputes under trade agreements in past administrations. "The Rapid Response Mechanism will help to protect the rights of workers, particularly those in low-wage industries who are vulnerable to exploitation. Because when we fight for workers overseas, we are fighting for workers here at home," Tai said.

She also said, "For too long, the United States has taken certain features of global markets as inevitable -- especially the fear that companies and capital will flee to wherever wages, taxes and regulations are lowest. The pandemic laid bare the challenge of this approach. And we need to fix it."

After her speech, Tai heard from several union members who have seen jobs at their plants move to Mexico, including one man who works at a Mondelez-owned bakery in Atlanta whose job, he said, is moving to Mexico. Mondelez told Reuters that cookie production would shift to other U.S. locations and to contracting bakeries, not to Mexico.

Tai told Steve Alexander, who has worked at the Georgia bakery for 17 years, that the closing is really upsetting news. "If companies move those jobs to Mexico and then violate their workers' rights to keep those wages down, we will take action," she said.

Jason Fletcher, an International Association of Machinists member in Chula Vista, California, said that United Technologies Corp. told workers at the plant in 2018 that production work would move to Mexico. "While aerospace workers are currently being laid off all over the country," he said, Mexico now has more than 60,000 aerospace jobs. While some are European companies establishing plants there, "many of these jobs were once our jobs," he said.

He asked her how she could stop the outsourcing of U.S. aerospace jobs to Mexico. Tai did not answer directly, but said that she knows that U.S. policy has led to jobs moving to other countries in the past, not just because of trade policy, but also tax policy.

Tai was also asked by a UAW worker from Lansing, Michigan, how she can make sure automakers do not move assembly to Mexico in the future, and that auto parts are made in the U.S. Fred Thomas told her, "It means a lot that folks like yourselves are allowing normal people like us, working people, to participate in these kinds of events."

Tai pointed to the labor value content requirement in the USMCA auto rules of origin, as well as the higher regional value content. And she noted that the administration wants to support the creation of a U.S. supply chain for electric vehicle batteries. "We want to make sure the next generation of our cars and trucks are made here in the U.S."

“I want to build off of this work while I'm at USTR and make sure that trade policy increases wages, strengthens our supply chain and supports the livelihoods and opportunities for workers like you,“ she said.