With UAW’s King for cover, Obama backhands labor in Korea trade deal

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During their 2007 strikes against the U.S.-Korea Free Trade Agreement, Korean workers held a rally at the Hyundai Motors factory in Ulsan. Now, temp workers are occupying the plant. Photo: Korean Metal Workers Union.

Labor Notes | December 8, 2010

With UAW’s King for cover, Obama backhands labor in Korea trade deal

Mischa Gaus

President Obama finalized the largest trade deal since NAFTA on Friday. It looks like he cut and pasted the same corporate-friendly script he inherited from previous administrations, Democrat and Republican alike.

In doing so he turned his back on labor and broke commitments he gave to union presidents in the weeks before the Korea trade deal was announced Friday.

Sources inside union headquarters tell Labor Notes that Obama met with AFL-CIO President Rich Trumka, Steelworkers President Leo Gerard, and Communications Workers President Larry Cohen in November, and promised that worker and environmental protections would be included in a deal with South Korea.

The eventual agreement contains none of those provisions—which U.S. unions have insisted must be the bedrock of a new, more humane trade policy. (Obama the candidate mouthed the same words).

But the agreement does have the approval of Bob King, president of the United Auto Workers, who shocked fellow officers—not to mention thousands of members who have agitated against corporate-backed trade rules—by supporting the deal almost immediately.

Reports say the deal would allow U.S. auto sales annually in Korea to rise from less than 10,000 now to eventually as high as 75,000, which could translate into about 1,110 full-time auto jobs (though not all of those would be union jobs or jobs in the U.S.).

The Public Citizen watchdog group is pointing out that “rule of origin” provisions that the UAW previously criticized did not improve. The rules require that a vehicle’s parts only have to be 35 percent U.S. or Korean to escape duty charges at the respective borders. Setting the bar that low gives auto companies in both countries a further prod to send work to low-wage Mexican and Chinese factories, because if they keep it under 65 percent of the car, it still counts as “U.S.-” or “Korean-made.”


The Economic Policy Institute estimates the Korea trade deal could cost 159,000 U.S. jobs. Pointing out that imports rose faster than exports following trade agreements with Mexico and China, EPI forecasts a rising trade deficit with Korea that will displace U.S. jobs, mostly in manufacturing.

Its impact on Korean workers will be severe, too. The Korean Metal Workers Union held five days of strikes over the free-trade agreement in 2007, calling out 110,000 members and declaring that everyone is affected by trade rules that encourage the slicing and dicing of jobs into part-time, contracted, precarious work.

NAFTA-style trade deals, like the one negotiated with South Korea, give multinational corporations rights to sue a national government if the government takes an action that reduces corporate profits. These suits can be used to undermine worker protections, environmental regulations, and safety standards.

Korean unions are already fighting lax labor laws that let employers hire cheaper, non-union temporary workers to replace permanent ones. Close to two-thirds of the entire Korean workforce doesn’t have regular employment status. (See this study for more on that.)

As the trade agreement was being finalized, temp workers were occupying Hyundai’s plant in Ulsan. Still going strong after three weeks, they’re demanding they get regular jobs instead of short-term contracts.


Perhaps Bob King was won over by some idea—or promise—that by supporting the deal he would ease the organizing of Korean-owned auto plants in the U.S. They’re an ever-larger force in the industry and all non-union: estimated output from Kia and Hyundai plants in the U.S. is 450,000 vehicles per year.

King’s made clear those companies are in the union’s sights: he and new organizing chief Richard Bensinger held a rally outside the Hyundai-Kia tech center in metro Detroit Monday and said they would soon propose to automakers rules to govern union organizing drives and elections.

UAW sources suggest King felt he had to back the trade deal as payback to Obama for pumping billions into failing automakers in 2009—although the bailout of Chrysler and GM laid off tens of thousands of workers and cut pay—in half—for future auto workers.

There was little understanding why King would go out on his own on such a key issue to labor. He told In These Times it was important to stay “relevant.”

“This is an about-face for the UAW and is flying in the face of the AFL-CIO,” one UAW official said. “A resolution passed at our last convention calling for fundamental changes to the Korea deal, and it didn’t happen. King just went ahead and approved it. It’s a hell of a thing to do, forsaking everybody’s interest for your own.”

Local leaders were taken off guard by King’s backing for the pact.

Joe Cardona is second VP of Local 174 near Detroit, which has a history of actively opposing free trade agreements. Cardona was surprised by King’s support and said, “There’s not a lot of happy people around here,” but, citing King’s commitment to solidarity with workers in other countries, added, “Sometimes you gotta go down a road you’re not used to going down and I hope it’s where we need to be.”

On the question whether King’s stance was quid pro quo for the bailout, he said, “I’m curious as to what was said to our organization when we were on the edge of the cliff.”


Neither the AFL-CIO, USW, nor CWA has uttered a peep about the deal. The UFCW put out a statement praising the “over 20,000” jobs it would create in exporting U.S. meat.

The Steelworkers executive board met Monday and Tuesday and is expected to release a statement today.

After watching the president they installed embrace tax cuts for billionaires, freeze federal workers’ pay, attack teachers, appoint a commission to hack at Social Security, and now sign a trade deal they’ve spent years fighting, what’s labor waiting for?

Union bigs are loath to lose their access to the White House, apparently, and eager to protect the scraps thrown their way, like the tariffs the U.S. trade commission installed on Chinese-made tires and steel pipe. (Although those with longer memories of trade policy remember that even George W. Bush briefly embraced protectionism for steel.)

“We’re fighting over crumbs,” one source said.

source: Labor Notes