One of Trump’s key pledges was to tear up trade deals, condemning them for sending American jobs offshore. He says he wants to re-negotiate NAFTA (the North American Free Trade Agreement covering Canada, the US and Mexico) and will refuse to go ahead with the Trans-Pacific Partnership (TPP).
He even suggested increasing tariffs, such as a 35 per cent tax on sales of cars produced in Mexico, as a way to keep jobs in the US.
It’s not surprising that this struck a chord, given the US has lost five million manufacturing jobs since 2000. Free trade deals are a disaster, but not because countries like America or Australia get a bad deal. They are deals designed to benefit corporations and the ruling classes of all countries—at the expense of workers and the environment everywhere.
The TPP for instance, contained a mechanism for corporations to sue foreign governments that passed any law or regulation that would “damage” their investments. Under similar mechanisms, French company Veolia is currently suing the Egyptian government for introducing a minimum wage. US company Lone Pine is suing the Canadian government under NAFTA for its ban on fracking.
But Trump’s bluster on trade paints overseas workers as the enemy. When Trump says, “Whether it’s China or Japan or Mexico, they’re all taking our jobs” he is stirring up nationalism and xenophobia.
Protectionism is not about saving jobs, but saving bosses’ profits.
Bluescope Steel demanded a $60 million subsidy from government in tax concessions last year in exchange for keeping its Port Kembla plant open. But at the same time it asked workers to accept 500 job cuts and a three year wage freeze. A year later the company’s profit was up 119 per cent to $293 million. But the 500 jobs are gone for good.
The car manufacturers in Australia took billions of dollars in subsidies and tariff protections over decades. But there were continual job cuts as the companies brought in labour-saving technology to boost profits instead of putting jobs first.
Instead of fighting the bosses to defend jobs, calls for government protection mean collaborating with the bosses to help them maintain profits. Nationalisation under workers’ control can guarantee jobs—but it means forgetting about the bosses’ profits and fighting them every step of the way.