Prime Minister Trudeau addresses the Senate this morning. Prime Minister Trudeau addresses the Senate this morning.

Canadian leader urges better salaries in MX

Prime Minister Justin Trudeau addresses Senate during two-day state visit

Canadian Prime Minister Justin Trudeau highlighted the need to improve salaries and working conditions in Mexico as part of the modernization of the North America Free Trade Agreement (NAFTA) in a wide-ranging address to the Senate today.

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On the second and final day of his first state visit to the country, Trudeau told senators and deputies at the joint sitting that improvements were essential to achieving a new deal that would stand the test of time.

“We must ensure that workers are protected by progressive labor standards,” he argued.

“Progressive labor standards are how we ensure that a modernized NAFTA will not just bolster free and fair trade but will enjoy long lasting popular support . . . . We must pursue trade agreements that are win-win-win, helping workers across North America achieve better standards, wages and working conditions.”

Wages have been a contentious issue in NAFTA renegotiation talks because salaries are much lower in Mexico compared to its two northern neighbors, and the U.S. especially has argued that it places its automotive and other manufacturing industries at a distinct disadvantage.

While it is unclear whether Trudeau raised the issue directly with the Mexican president, Enrique Peña Nieto said last night “Mexico doesn’t want to be competitive based on low wages, Mexico wants to be competitive on the basis of skilled labor.”

In his Senate speech, Trudeau also talked up the relationship between Mexico and Canada: “Our bilateral ties are stronger than ever, our economies are closely integrated, we stand together on the world stage and we have a shared vision of progress . . . last year we did $40 billion in two-way trade.”

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He thanked Mexico for its leadership on climate change and for supporting the inclusion of a section in a new NAFTA deal that recognizes the specific importance of women in the labor market as well as their rights.

“We must move the needle forward on gender equality, this is an idea that all nations of the world should get behind,” he said.

“This is why Canada is so appreciative of Mexico’s support for a gender chapter in the modernization of NAFTA . . . this is a progressive step forward that we can’t afford not to take.”

However, Trudeau quickly changed the tone of the speech, saying, “we still have work to do, notably as it relates to human rights.”

“Just yesterday, I met with civil society leaders here in Mexico City and I heard stories about the treatment of women and girls that are unacceptable,” he said.

According to those he met, Trudeau asked for a security assessment of the country and was particularly interested in the Ayotzinapa case involving the disappearance of 43 rural teaching students and gender-based violence, while he also reportedly asked how Canada could help.

“. . . We talked about issues like violence, corruption, impunity and serious violations [of human rights],” said Mario Patrón, director of Center Prodh, a human rights defense group.

Security specialist Ernesto López Portillo said Trudeau wanted to speak to them before he met President Peña Nieto so that he could relay their message to him, although he stressed that Trudeau was insistent that Canada wanted to help rather than tell Mexico what to do.

After the meeting, Trudeau attended an official reception at the National Palace where he met with Peña Nieto and other government officials before meeting with Mexican firefighters to personally thank them for their efforts fighting wildfires in Canada earlier this year.

Trudeau concluded his Senate address with an emphatic, “Viva Canadá y viva México” that was met with rapturous applause, indicative of his popularity both among politicians and the general population in Mexico.

Prior to his address, Senate president Ernesto Cordero thanked Trudeau for his support in the aftermath of last month’s two devastating earthquakes and stressed the importance and closeness of the bilateral relationship.

He also said that the NAFTA renegotiation talks were an opportunity to show the world that the three North American countries are stronger together.

“Neither Mexico nor Canada is a problem for the United States or any other country. Together the three countries are the solution,” Cordero said.

Source: Reforma (sp)

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  • Güerito

    The part left out:

    “Mexican wages are a key element in NAFTA talks, with Washington pushing to increase labor protections and pay. Auto workers in Mexico, for example, often earn about $2 per hour compared with $30 or more by their counterparts in the other two countries.

    Wages are kept low in Mexico in part because of antiquated labor laws and pro-government unions that often sign contracts behind workers’ backs. Some unions are so absent from the workplace that employees sometimes don’t even know one exists.

    (The Mexican) government has not moved to get rid of thousands of pro-company “protection” contracts that prevent real unions from organizing. And leaders of crooked labor federations are in many cases members of Peña Nieto’s Institutional Revolutionary Party, or PRI.”

    http://abcnews.go.com/International/wireStory/canada-pm-talks-wages-mexico-visit-amid-nafta-50469679

    • By the way, workers do not earn an hourly wage, they work for a daily wage and they are paid for 7 days. In your post you are referring to what we call “white unions” basically employed by the employer to keep a company from going on strike. There has been a change in the way Unions are run since the labor law reform in 2012 – it only takes 5 workers to force a change of Unions, and workers can form a completely autonomous union. When a union goes on strike, they legally seize the plant, the owners and management cannot enter the site and there is no such thing as scab labor in Mexico.

      • Güerito

        So, you’re saying the multiple Mexican legal experts cited in the AP/ABC, Chicago Tribune, and Bloomberg articles are not up to date on labor law in Mexico? And that we should instead rely you, a lawyer who works for maquiladoras in Tijuana? No thanks.

        • Yes, that is what I am saying. I am a Mexican attorney who deals with this issue on a daily basis. I am also the only source for a complete translation of the Federal Labor Law to English which i have been updating and selling online since 1996. I not only defend employers who are my clients in labor lawsuits but I handle labor lawsuits pro bono for workers who I feel have been mistreated, 5 this year so far. Anyone who actually works in Mexico will back me up on this point and if you like I an cite chapter and article and provide you with the text in English to prove my point.

          • Güerito

            One question:

            Do you agree or disagree that a great number of maquiladoras and factories in Mexico are now using what are described in my links as “protection contracts”? Agree or disagree?

            And that, as the many articles state – government-backed unions (tied to the PRI party) sign contracts with multi-national corporations, despite the fact that they in no real sense represent the workers? And that these types of contracts, signed on behalf of workers by “crooked labor federations” (AP) are responsible in large part for keeping manufacturing wages low in Mexico? And that labor contracts such as these are illegal in Canada, the US and most of Europe?

            You can perhaps cite some (new?) article in the legal code or some administrative ruling, but, today in Mexico these experts say these bogus contracts remain in force. And not only remain in force, but are the norm and dominate the industry.

            Yes or no?

  • Mexican workers have low wages which need to be adjusted up and Mexico should go to a 40 hour work week. Their work benefits are better than anything in the US, vacations, overtime, health care are obligatory. Workers have access to low payment mortgages through their employers, free day care, women receive 12 weeks paid maternity leave. An injured worker receives 100% of his salary until he can go back to work. Most workers also receive transport, food coupons, and the 15 days wages (Aguinaldo) is mandatory and paid on Dec. 20. There is also a huge gap between college educated workers and workers who are not. Mexico should demand that the US obligate the same benefits to their workers.

    • Güerito

      I’ll just repeat what I wrote in response to your nearly identical comment five months ago:

      Glenn, the job security, aguinaldo, maternity leave, paid vacations and overtime are all being paid based on the $1.10 USD an hour salary cited in the Bloomberg article I posted below.

      Most of the benefits you cite are standard for factory workers paid up to 20 times more around the world. The exception might be the aguinaldo. But that two weeks pay at $1.10 an hour, makes the post-aguinaldo pay equal to around $1.15 an hour.

      Also, most auto factory workers elsewhere make enough money to pay for their own work transportation and food. The free transport and hotmeals strike me as a paternalistic admission on the part of owners and management of just how low these salaries in Mexico really are.

      The Infonavit housing is not what it used to be. The “houses” are getting smaller and smaller, and more likely located very far from any urban center. I know a lot of these Infonavit “houses” are located near maquiladoras. But with the poverty wages, coupled with Infonavit houses nearby and free work transport and food, the whole thing closely resembles the “mill towns” or “company towns” common in the US mid-to-late 19th century.

      • Companies look for ways to provide more compensation without increasing their Social Security payments which are based on wages – most employers pay 30% on top of wages for Social Security which is medical, disability, maternity, retirement, etc. INFONAVIT can be used to purchase any property not just houses built by contractors and yes, the small houses are a problem. They were meant to be first homes for single workers, but it didn’t work out. Those houses can no longer be financed by INFONAVIT. 2 of my daughters have very nice 3 bedroom homes in gated communities that they bought through INFONAVIT. I help companies set up transportation, hot meals, clinics and other programs. Companies can pay for transportation and it is not considered wages so there is no income tax and it does not increase Social Security, the same with uniforms, safety shoes and other similar benefits. With INFONAVIT, you can buy a lot and build a house, you can use it to finance any home.

        • Güerito

          Bloomberg cites a starting salary of $1.10 USD an hour for factory/maquiladora work. The AP/ABC link below uses a $2.00 USD an hour figure for Mexican factory work. Let’s go with the $2.00 an hour.

          Using your estimate of “30% on top of wages” for all those benefits, the bottom line is the Mexican factory worker is costing his employer only about $2.60 USD an hour.

          The $30.00 USD an hour figure for US factory work, cited by AP, is more than 10 times the Mexican rate, and that’s not counting in the abundant benefits enjoyed by factory workers in the US.

          Here’s the testimony of a worker at an Audi plant in Mexico:

          “Badillo is typical of the plant’s employees. He works in the paint shop, and lives with his son, Alejandro, 13, and daughter Noemi, 11, in a tiny 500 square-foot (47 square meter) government-subsidized apartment that he’ll be paying off for decades.

          Like many of the Audi employees, he has some college education — he started a bachelors’ degree in electronics — and he makes about $120 per week. His wife works in a department store, making less than he does. After paying their mortgage, utilities and taxes, they might have $50 per week to spend on food, entertainment and schools supplies.

          Badillo can’t afford a car. He takes the company bus two hours to work and two hours back. Alejandro would like an Xbox video game and Noemi would like a tablet, but they know their father can’t afford it.”

          http://www.chicagotribune.com/sns-bc-lt–mexico-low-wages-20170925-story.html

      • Mike S

        I don’t want to defend low wages for Mexican car assembly line workers, but comparing $2 an hour in Mx to $27 an hour at a US plants is not as extreme as it sounds if you consider the huge difference in the cost of living between the two countries. Some examples:

        Typical average restaurant meal out- Mx $2 ; US $10

        Street food versus McDonalds $1 vs $6

        Dental crown: Mx $150; US $1000

        Hospital stay- US $500 day; Mx $70

        Prescription drugs- Mx 70% cheaper

        Local bus fair- US $1; Mx a dime

        Drink in a bar Mx $1 US $4

        Utilities (gas & electric) are typically 75% cheaper because of moderate climate

        Typical 3 bedroom 2 bath house California $250000, Mx $35,000

        Fire insurance and property taxes for that house (Texas) $2000 annual; Mx $200

        Doctor appointment US $120; Mx $20

        Collage public annual: US $25,000; Mx $2500

        People in US try and imagine living in their home towns on $16 a day and are horrified.

        • Sock it to ’em, Mike. Every time I hear about miserable wages in Mexico, I note that no mention is made about the drastically lower cost of living. It does not entirely level the field, but it goes a long way toward doing so.

        • Güerito

          Well, I’ll bet a typical auto assembly line workers in the US lives in houses quite larger than 500 square feet, and can afford at least one vehicle and can buy their kids computer games.

          Overall, the cost of living in Mexico is about one third what it is in the US. Wages are about one-tenth in Mexico what they are in the US.

          Many of your figures about costs in Mexico are off.

          • Mike S

            I did not defend low wages paid to Mexican auto assembly line workers. I am simply pointing out that wages go a lot further in Mx and it’s not as extreme as most Americans might think. It doesn’t take a rocket scientist to understand that the US is a wealthier country than MX. Cost of living just like the US can vary greatly depending on city and state. $35,000 will buy a decent 1000 sf house in most parts of Mx and rents are probably about 80% cheaper for lower middle class Mexicans. Twenty million Americans live out-of-sight in trailer parks in the US. Fifty million more rent small cramped apartments at high rents usually eating up half their income. Seventy million Americans live in government assisted housing of some sort. Mexicans have very cheap health insurance available to them. I’m all for doubling assembly line workers pay. Big international corporations can afford it and that wouldn’t stop investment. Most Mexicans own or have access to a car; they just tend to be older cars. Mexicans are great mechanics and squeeze a lot more useful life out of vehicles than most Americans.

          • Güerito

            Since you incorrectly state most Mexicans have at least access to a car, I should point out that gasoline is almost 50% cheaper in the US. Incredible, but true. Also, most vehicles, both new and used, cost the same or more in Mexico than in the US. Used vehicles are usually much cheaper in the US.

            Electronics and other household appliances cost about the same in Mexico as in the US. This, of course, explains why there is a huge market in Mexico for bringing in used vehicles and appliances from the US. Ditto clothing. The used US clothing brought in is mostly higher quality and MUCH cheaper than new clothing in Mexico.

            Finally, one of the things that deported Mexicans parents complain most about after arriving back in Mexico are the large “fees” that must be paid for items in supposedly “free” public schools. Let alone the horrible state of the schools themselves.

            I just find it more than a little offensive to hear ex-pats in Mexico, enjoying their pensions and/or scoial security, talk about how Mexican wages are really not so bad.

            BTW, you have it reversed when it comes to housing. Home prices are only about one half what they are in the US. In most urban areas in Mexico, $100,000 USD is a inexpenseive 2 or 3 bedroom house. (CA, your example, is the most espensive real estate market in the US)
            Rental rates, however, are many times lower, only about 20% of rental rates in the US. Which is why I’m always puzzled so many ex-pats buy homes rather than rent.

          • Mike S

            There were approximately 300 cars per 1000 people in Mx in 2014 (59th in world out of 193 countries….US 750). New car sales have been on the rise since 2009 reaching 1,6 million units by 2016. That would seem to average one car for a family of three. I am sure that varies greatly from state to state. Again housing costs vary greatly from state to state and city to city but my experience is about $35,000 for small 3 bdrm older houses. Maybe your experience is different. Coastal resort cities and Mdf are higher of course. Most COL costs Americans see are for computed for expats living in more affluent areas on coasts. I certainly agree that renting for expats makes more sense…at least for first few years. Rents are low because there are almost no property taxes, home owners insurance, and mortgages are rare.

          • Güerito

            The 300 vehicles per 1,000 people in Mexico you cite includes buses and cargo trucks. Nice try.

            New private vehicles sales have only recently been on the rise in Mexico, and I suspect it has to do with increased pollution controls in Mexico City. These rules limit the days you can drive vehicles based on license plate numbers.

            Since pollution controls went into place in Mexico City, the number of private vehicles has almost doubled – from 3.5 million to 6.8 million – in just the last ten years. Just in Mexico City. And this is where the overwhelming majority of the wealthy live. (the law of unintended consequences)

            And my 100,000 USD for a three bedroom in Mexico is not a coastal or tourist zone.

          • Mike S

            So what if a one fourth are buses and cargo trucks? New car sales are accelerating & passenger cars are plentiful in Mx even if they tend to be much older than in the US. Several new Asian investors are building plants for low cost cars for the domestic market. The whole point of my comments was that yes assembly line workers need raises but life is not as impoverished as many would believe in the US. Trump does not understand NAFTA and does not realize revoking it would hurt both countries but the US more. NAFTA needs to be updated but not eliminated. NAFTA was a good trade arrangement that has helped both countries. Trump plays to his fearful base that NAFTA is the worst trade agreement in history. The man is an unread imbecile.

          • cooncats

            Given how you are being shown up in this discussion, I’d suggest you be more circumspect in labeling anyone else as an unread imbecile.

          • Mike S

            You have swallowed the narcisstic, pathological lying, conman’s snake oil hook-line-&sinker so deep it’s hopeless to try and show you the emperor has no clothes. If he gets rid of NAFTA it will be a disaster. So far he has torn up the Paris climate accords, tried and reinstate coal (failure), failed at health care reform, can’t get anybody interested in his dumb wall, tried to revoke Iran nuclear deal (failure), get tax reforms favoring his business & estate, destroyed the EPA by executive orders, sold the Saudi terrorists $2 BILLION in arms, screwed Puerto Rico, has said nothing about the $10 billion California wild fires (indirectly caused by drought & climate change), encourage the KKK & Nazis, stirred up racial animosity and attacked the NFL, and handled NK like a two year old. Cant wait for 2018. Corker is right….he needs a day care handler.

          • cooncats

            Yap, yap, yap. God you are boring.

          • Mike S

            I’d rather be boring than mindless.

          • Paul Wilkins

            I`ve seen houses advertised in Merida for as little as (US$6,000). These are modern little houses in outlying areas, that have decent public transport and are safe to walk around in. The price is so low because such areas are not on the fashionable side of Merida. I don`t think Merida is inexpensive compared to most of Mexico.

          • Güerito

            I think you’re very misinformed, Paul. It’s difficult to buy small, vacant lots in rural areas of relatively poor states for $6,000 USD. My girlfriend built a small apartment (probably about 500 square feet) on top of her house a few years ago. The construction costs was about $25,000 USD.

        • Don Taylor

          you r absolutely right

    • alance

      Their work benefits don’t put food on the table. The workers are still wage slaves.

      • If you read my posts you would see that I am in agreement with you on wages. In fact, many of us who work in this field stated our fears and opposition to the NAFTA treaty at the time it was proposed by Pres. Salinas. The biggest complaint or fear of opening the Mexican market up to the US was exactly what has happened. The country has industrialized at the expense of maintaining low wages. Most of the US companies manufacturing in Mexico, basically are renting labor – they are all set up with a contract from the US side that pays the expenses, rent, logistics and wages plus 3%, the profits are all obtained outside of Mexico. These companies pay income tax on that 3% “profit” – I have a client, the owner of the company is from the US, with a US home company, he has 85 employees and has sales of 25 million in the US and his company pays less income tax than I do. This was the fear about NAFTA and it has occurred. There is a big push in Mexico right now to correct this – one of the major factors in keeping wages low is that the general minimum wage (there are 177 minimum wages in Mexico stipulated by profession) was linked in Article 123A of the Constitution to government fees, infractions – everything was stipulated by the general minimum wage. For example, I was fined 15 minimum wages for not wearing a seat belt. In January of 2016, this article was reformed to unlink the minimum wage from government fees and the minimum wage was raised almost 10% which means that all wages rose by that amount. Many people, myself included are supporting the candidacy of Lopez Obrador in 2018 for President, because he says that he is going to raise wages dramatically with the goal of some kind of balance with the US and Canada. I am all for that as are many other professionals in the field. I am also very much in favor of withdrawing from NAFTA and allowing the WTO tariffs to kick in and for Mexico to place antidumping tariffs on agricultural products. As it is now, NAFTA mostly benefits large US corporations.

  • Güerito

    How Mexico’s Unions Sell Out Autoworkers – Wage contracts are inked years before plants open and workers never get a say.

    “The German automaker BMW has a labor contract signed by a representative from the state chapter of the Confederación de Trabajadores de México (CTM), the country’s largest union confederation, and notarized by a Labor Ministry official. The document, which Bloomberg reviewed, sets a starting wage of about $1.10 per hour and a top wage of $2.53 for assembly-line workers. The starting rate is only a bit more than half the $2.04 an hour that is the average at Mexican auto plants, says Alex Covarrubias, a lecturer at the University of Sonora in Hermosillo.

    So-called protection contracts— agreements negotiated between a company and a union that doesn’t legitimately represent workers—are illegal in the U.S. and Germany. But Lance Compa, a senior lecturer at Cornell’s School of Industrial and Labor Relations, says they’re standard operating procedure in Mexico, where deals are cut factory by factory rather than collectively across a company or industry. Experts say this is a primary reason that wages in the auto sector have stagnated in recent years, despite a fresh wave of investments by foreign carmakers, most recently by German and Japanese manufacturers. Mexico’s union bosses and politicians are more interested in keeping corporations happy than in raising the living standards of workers, Covarrubias argues. “Protection contracts are a way to keep wages artificially low,” he says.”

    https://www.bloomberg.com/news/articles/2017-05-05/how-mexico-s-unions-sell-out-autoworkers

  • alance

    Yeah, and raw sewage is great for the environment also.

    Justin Trudeau is such a joke.

  • Dave Warren

    The rich can easily afford better pay across the board in Mexico. You can say what you want . The rich are far greedier in Mex that anywhere.

  • Cool Hand Luke

    Maybe Trudeau can start fixing our own country before trying to fix others and stop vying for the UN seat.
    Takes a nice photo, young and handsome, has a good family “name(?)” and is personable, if you’re a liberal.
    Sounds like many Mexicans are going to fall for and making the same mistakes many Canadians did in voting for him.
    If I was not a resident of Mexico, I’d say “keep him” but I could never do that to our good hosts.

    • Anthony Stein

      Maybe you are right but compared to that jerk-off that the gringos have for a leader Trudeau wins hands down! Trump is a blithering idiot! Are Americans ashamed yet?

  • That’s just what we need down here. This nincompoop’s “progressive standards.”

  • Jungle Cat

    WoW So many expats have all the answers to Mexico/s ills But can’t seem to get their own country in proper shape…

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