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President's ''fast track'' negotiating unlikely without environmental focus

WASHINGTON, DC – 01/29/07 – Greater adherence to international labor standards will be at the center of the debate as congressional Democrats seek to strengthen US trade agreements, according to several trade analysts.
 
Language on such standards as the right to associate and to bargain collectively, prohibitions on child labor and forced labor, and employment nondiscrimination, they say, is likely to be included in any legislation to renew Trade Promotion Authority (TPA).

TPA, also known as “fast track,” which gives the US president power to submit trade deals to the House of Representatives and Senate for up-or-down votes without amendments, expires in July.

It also defines objectives, which US negotiators must work toward when they negotiate free trade agreements (FTAs).

Democrats advocate better labor and environmental provisions in trade bills to ensure that companies and countries do not gain an unfair competitive advantage in trade by denying their workers basic rights and neglecting environmental protection.

Some Democrats also view these provisions as a way of encouraging developing countries to move toward more sustainable development.

Labor issues are more politically sensitive than environmental ones because a global shift in job creation and job losses is viewed as inherently tied to trade, says Edward Gresser of the Progressive Policy Institute.

The institute is associated with the Democratic Party.

Democrats, according to Gresser, “feel particularly strongly about labor rights, which are among their party’s traditional core values and enjoy a strong support from its key constituencies – labor unions.” 

Any TPA bill supported by Democrats will be built around the principle of making a country’s labor laws consistent with International Labor Organization (ILO) core standards, even though the US has ratified only two of eight core ILO conventions, according to experts.

It also likely will include a stronger enforcement mechanism and a more powerful oversight role for Congress.

Democrats hope to make labor and environmental issues in future free trade agreement talk as important as such negotiating objectives as intellectual property protection and market access, experts say. 
 
In 2001, TPA bills proposed by Democrats Max Baucus (D-Montana) and Charles Rangel (D-New York) which sought stronger language on labor and environmental matters were rejected.

Now Baucus and Rangel are chairmen of the committees, in the Senate and House respectively, which have jurisdiction over trade issues.

In addition, the overall political climate has changed, said Frederic Mayer, a political scientist at Duke University in North Carolina.

The virtues of free trade, he said, are now being re-examined in terms of the distribution of benefits among different countries and social groups.

“It seems to me that the old formulas for free trade plus side agreements on labor and environment may be quite insufficient,” said Mayer. 

Rep. Sander Levin (D-Michigan), chairman of the powerful House Ways and Means Subcommittee on Trade, said earlier this month that Democrats “want to ensure that the benefits of globalization are spread to all levels of society, including workers.”

According to Randal Soderquist of the German Marshall Fund, even some Republicans are likely to support stronger labor provisions because “they are as upset as Democrats by labor abuses in some developing countries.”

Many congressional Republicans and business groups, however, are concerned that stronger language on social provisions – for example, endorsement of the ILO standards the US has not ratified – could be used by US organized labor and environmental groups to challenge certain laws and regulations in courts.

“Republicans would resist anything that is an open invitation to litigation,” says Claude Barfield of policy research organization the American Enterprise Institute (AEI).

Many developing countries have strongly resisted inclusion of social provisions, particularly labor standards, in FTAs because they perceive them as barely disguised protectionist measures, or as well-meant efforts ill-suited to their developmental stage and political and social conditions.

But fears that labor and environmental provisions can be used as protectionist weapons so far have not materialized despite their inclusion in various forms in FTAs reached in recent years, Gresser said.

He said he believes good labor and environmental policies pay off in the long run as countries pursuing them are able to attract good quality investment.

Gresser said the best way for his fellow Democrats to address the two issues is to focus more on incentives than sanctions, either through FTAs or trade preference programs.

Whatever direction congressional Democrats take, the Bush Administration seems to be resigned to the inevitability of having to adjust the course on trade.

Deputy US Trade Representative (USTR) John Veroneau told reporters recently the labor provisions in the FTAs signed with Colombia and Peru and the one concluded with Panama will need “substantive adjustment” to win congressional approval.

Following meetings with individual congressmen two weeks ago, USTR Susan Schwab said she is open to dialogue on FTAs’ labor provisions.

“We are going to work with congressional leaders – Democratic and Republican – on the labor language to see if we can construct a new template that is going to be acceptable to our trading partners," she said.

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