We need a trade deal that works for people and the planet
Sierra Club | 17 March 2025
We need a trade deal that works for people and the planet
By Iliana Paul March 17, 2025
Trade agreements have long shaped economies and environments worldwide. But unfortunately, they’ve also prioritized corporate profits over people and the planet. The North American Free Trade Agreement (NAFTA) exemplified this issue, leading to weakened environmental protections, increased industrial pollution, and exploitative labor practices. NAFTA’s successor, the United States-Mexico-Canada Agreement (USMCA), was touted as an improvement, but it has also largely failed to address these systemic issues.
A federal review of the USMCA is approaching later this year. This is a critical opportunity to demand a trade deal that prioritizes people, the environment, public health, worker rights, and innovative manufacturing. It’s time to ensure a new trade era for people and the planet.
Trade Agreements : A History of Harm
More than a decade ago, the Sierra Club and partners detailed the harms NAFTA wrought on communities and the environment, including weakened environmental protections that increased industrial pollution and harmful extractive practices in Mexico and Canada.
This story of “free trade” is the same around the world. Countries have undermined the integrity of their environment, communities that depend on clean air and clean water, and their workers in exchange for foreign investment and the promise of international markets for their goods. The USMCA, negotiated during President Trump’s first term, has unfortunately been no better, despite promises to protect communities and improve the economy. With a federal review of the USMCA approaching later this year, the Sierra Club is gearing up to fight for a new trade deal that works for people and the planet.
Throughout history, some level of trade between different groups of people has always existed, thanks to an economic principle called “comparative advantage.” Simply put, this boils down to : “I will make what I’m good at making and buy the other things I need from people who are better than I am at making them.” For example, Colombia has the right environment and know-how to grow coffee beans. So rather than growing coffee in the U.S., we import it from Colombia and other countries. In exchange, Colombia might buy soy beans or yellow corn from the U.S., which we grow in abundance.
Modern trade is not so simple or mutually beneficial. The world now trades a huge number of goods, from materials like steel and cement, to consumer goods like cars and cell phones, to crops, packaged foods, and digital services. Not only do these goods often have inputs or parts that come from around the world, producing them is often quite dirty and exploitative. Steel and cement, for example, each account for about 8% of global greenhouse gas emissions, and also produce harmful air pollutants and other toxics.
Environmental Protections in Trade Agreements
In our modern and global economy, environmental protections in trade deals are incredibly important to protect our natural resources. Unfortunately, different countries have different rules about these environmental protections, and this has allowed powerful multinational corporations to take advantage of — or even push for — weaker environmental protections to reduce their operating costs. Extractive and polluting industries that were once limited by geographic boundaries now operate globally, often moving their manufacturing facilities to countries that turn a blind eye to their harmful activities. In anticipation of NAFTA, Mexico passed laws making it easier for U.S. and Canadian mining companies to operate there. A huge portion of land in Mexico is now open to resource extraction, with many foreign companies in control. This mining boom was followed by widespread water contamination.
Human and worker rights have also been trampled worldwide in the name of free trade. What were once good-paying, stable jobs were moved to countries known to exploit workers and communities. This phenomenon is called the “race to the bottom.” After NAFTA began, an enormous number of export-focused factories sprung up in Mexico, many in the chemicals and metals sectors. This led to abundant local pollution and stagnant wages for Mexican workers because the manufacturing explosion relied on low labor costs, as with most free trade deals.
Free trade has often led to exploitation and environmental degradation. The supply chains for goods we use every day, from cars to computers, are now global, and companies take advantage of weak environmental, labor, and human rights protections to make things as cheaply as possible. Our current free trade system puts corporate profits over people and the planet, and that needs to change.
Renegotiating USMCA : A Race to the Top
But the story of free trade does not have to be all gloom and doom. We are entering a moment where we can rewrite the rules of trade. With federal review of the USMCA approaching later this year, we are ready to start the race to the top. The initial negotiations for the USMCA negotiations did achieve some wins, but there were losses, too.
The USMCA needs a major overhaul to become a trade agreement that supports good jobs, innovative manufacturing, thriving communities, and a livable climate. The Sierra Club is advocating for major changes to the USMCA that would make it a better deal for people and the planet. We need all hands on deck to call for an updated USMCA that makes sure all three countries uphold strong environmental standards, address climate change, and create green jobs.
The federal government is preparing now for the upcoming renegotiation of the USMCA. By July 2026, the U.S., Canada, and Mexico will decide whether they plan to continue with the agreement for another 16 years, modify the timeline of the agreement, or terminate the agreement altogether.
We need a new trade deal that works for people and the planet, not just big corporations. The Sierra Club is preparing to lead this fight on behalf of the environmental movement and in partnership with labor, faith, and consumers’ rights groups. It will not be easy to push to bring our priorities to the negotiating table with the Trump administration, but people power is key to our success.
