Political Science Professor Laura Macdonald and Angelo DiCaro, Director of Research at Unifor answer this question in their new blog/commentary.
In many ways, the signing of the Canada–United States–Mexico Agreement (CUSMA) in 2018 represented continuity more than change in North American economic governance.
Except for some unique rule changes in the trade of vehicles and component parts, many aspects of its predecessor, the North American Free Trade Agreement (NAFTA), were maintained in the renegotiated deal. In some areas, neoliberal disciplines were deepened. Canada made one-sided concessions to further open up its dairy industry, for example, while agreeing to a first-of-its-kind chapter on “good regulatory practice” that limits government’s ability to enact more protective or precautionary public interest regulation.
In one respect, however, CUSMA, which took effect in July 2020, represents a victory for workers.
The new NAFTA includes a labour chapter that expands the scope of government obligations and attaches sanctions to the violation of fundamental labour rights. Those rights and obligations are currently being tested in three early disputes related to unfair working conditions in Mexico and the U.S., which we describe below.
If the cases succeed, it could significantly shift the balance of power between workers and employers in North America—a relation that was badly skewed in the latter’s favour by NAFTA.
To many workers and their representatives, a major problem with NAFTA was the incentive it provided companies to relocate production to low-wage and rights-deprived jurisdictions on the continent. In Mexico, for example, workers’ wages were already artificially depressed by the corrupt and undemocratic system of labour control in place in that country. NAFTA legitimized and facilitated the exploitation of these North American wage and rights discrepancies by multinational capital.