Stop Trump’s Tariffs on Mexico! — Stop the USMCA, No Wall!

Full Labor Rights in U.S. and Mexico!

Statement by the Sacramento chapter of the Labor Council for Latin American Advancement (LCLAA, AFL-CIO)

May 31, 2019 — Donald Trump has declared economic war on Mexico. He announced that unless Mexico “puts an immediate stop to illegal migration” from Central America through Mexico, the United States will impose a 5% blanket tariff on all Mexican goods coming into the United States. For every month that this issue is not “remedied,” Trump added, the tariff will increase by 5%, with a ceiling at 25% by October 2019.

Mexican President Andrés Manuel López Obrador sent a two-page letter in which he insisted that the two presidents must find a “peaceful, negotiated solution” to the immigration crisis based on economic development and job-creating productive investments in the Central American countries. “Only this way will we resolve the underlying roots of the painful immigration problem,” he said.

But López Obrador also issued a warning to Trump: “Social problems are not solved with tariffs or coercive measures. … If [Trump’s] tariffs are implemented, Mexico will respond in a forceful way. … I do not lack courage, nor am I a coward.” (This latter point was interpreted widely in the Mexican press as a critique of former Mexican President Enrique Peña Nieto.)

López Obrador went one step further, denouncing Trump’s anti-immigrant rhetoric and actions. “America First is a fallacy,” he wrote. “How is it that overnight the country that opened its doors wide to immigrants from around the world is now a ghetto, a closed space, where people are stigmatized, mistreated, and deported, and where the right to justice is denied to those who through their hard work and valiant efforts simply wish to live free from misery? The Statue of Liberty is not an empty symbol.”

We agree with López Obrador’s sharp rebuke of Donald Trump. But a fundamental problem arises: The economies of Mexico and Central America have been devastated by the NAFTA and CAFTA “free trade” agreements. Millions of people have been forced to flee their countries because of the devastation to their industries and farm sectors wreaked by “free trade.” Among those hardest hit are the indigenous peoples, who have been driven from their lands and communities. This is the major underlying cause of the mass migration and the growth of the drug cartels.

The recently negotiated USMCA trade agreement — which López Obrador has endorsed — is no better than NAFTA; it has been characterized widely in the U.S. labor movement as NAFTA 2.0. It will continue to impose death and destruction across the region.

The USMCA “free trade” treaty is unacceptable: There are no hard-and-fast enforcement provisions to ensure labor and environmental rights (which have been trampled upon year after year). The Investor State Dispute Settlement (ISDS) prevents Mexico from enforcing its sovereignty over its natural resources and State enterprises; it must be removed outright from any trade treaty. The list goes on.

We also must work to tear down the Wall of Shame along the U.S.-Mexican border, and stop all deportations and open a path to legalization for all undocumented immigrants.

Without ensuring that we have trade based on mutual respect and the recognition of the sovereignty of the nations south of the border, there will continue to be columns of refugees making their way toward the United States — refugees whose only “crime” is to seek out a better life for themselves and their families, just as countless generations of working people have done throughout the history of the United States.

– The Statue of Liberty Is Not an Empty Symbol!

– Tear Down the Wall of Shame!

– Stop the USMCA Agreement!

– Stop All Privatizations and ‘Counter-Reforms”!

– Support Workers’ Rights to Unionization and Collective Bargaining on Both Sides of the Border!

* * * * * * * * * *

Refinery of Dos Bocas: A Question of National Sovereignty that Puts the Re-nationalization of the Oil Industry Back on the Agenda in Mexico

(reprinted from the May-June 2019 issue of Transición, published by CORCI-México)

At his morning press conference on May 13, President Andrés Manuel López Obrador announced that the government’s effort to find a private consortium willing and able to build the Dos Bocas Refinery in the southeastern state of Tabasco had fallen through. The president explained that none of the private companies seeking to build this refinery had presented a viable budget, as all exceeded the estimated cost of $8 billion.

López Obrador also announced that the Secretary of Energy, Rocío Nalhe, would henceforth be in charge of the building of the refinery and that PEMEX itself would participate in the effort.

This announcement generated a wave of criticism in the business media. The Economist (a pro-business magazine) wrote in an editorial article that “the building by the Ministry of Energy and PEMEX of the Dos Bocas refinery would be an even more serious blow to corporate interests than the cancellation of the airport.”

Elsewhere in the magazine, Luis Miguel Gonzalez wrote, “Why do markets react like this? PEMEX is a heavily indebted corporation and it is being earmarked for a project that has a high chance of failure.”

López Obrador promised during his campaign the construction of this and two other oil refineries, in addition to modernizing the current ones, with the intention of recovering energy sovereignty, which has been lost in the last decades as a consequence of the privatization policies of PEMEX, a hitherto nationalized company that has been deliberately mismanaged with the aim of bankrupting and privatizing it. Today Mexico imports 68 % of the gasoline consumed, and the price has not stopped rising, which is a great contradiction since Mexico is a leader in the extraction of crude oil.

The only way one can explain that a company as profitable as PEMEX, with the most valuable resource in the world, is today in debt is the programmed mismanagement of the State enterprise by the previous governments and their appointed administrators.

Today it is urgent to recover our energy sovereignty, the essential pillar of our nation’s sovereignty. PEMEX was created in 1938 with the objective of serving the development of the nation. Thanks to to PEMEX, Mexico’s has been able to finance a good part of the nation’s public services, the construction of schools and hospitals, as well as the salaries of public workers — in a word, it has been the backbone of the economy of the nation. The so-called “neoliberal” governments have done everything possible to put the oil profits in private hands.

López Obrador’s proposal to generate our own gasoline is a step forward, but it is not enough. The Energy “Reform” Law enacted under the previous administration of Enrique Peña Nieto went a long way toward privatizing and dismantling key branches of PEMEX.

The question thus arises: Is it possible to recover our sovereignty without repealing the Energy Reform Law, without reversing the privatization of all branches of PEMEX? Can an independent policy at the service of the Mexican people be implemented following the ratings and directives of transnational finance capital? The answer is clear: No, it is not possible.

As former President Lázaro Cárdenas did in 1938, it is necessary today to break with these foreign corporate interests. The building of Dos Bocas and the other two refineries must be accompanied by a change of direction in energy policy — a change that places this resource at the service of national development. The first step in this direction is to repeal the IMF- and World Bank-imposed “energy reform” and to renationalize the oil industry.

Adopting such a course will not be easy. It will go up against the new USMCA “free trade” agreement, which, like the earlier NAFTA agreement, contains an Investment State Dispute Settlement (ISDS) provision that explicitly bans any expropriation of capitalist interests in any of the signatory countries. Reclaiming Mexico’s oil sovereignty will therefore require stopping and, if necessary, repealing the USMCA agreement.