Washington Post
KING ABDULLAH of Jordan arrived in Washington for a week's stay last week, hoping among other things to see a bilateral trade pact that his country negotiated with the Clinton administration win the approval of Congress. Ordinarily, nobody would object to this trade deal: Jordan's potential exports are too small to rile protectionist lobbies, and Jordan is an ally. But the deal is controversial because it includes provisions on labor standards that some see as a model for the future.
The idea of including labor standards in trade deals is often caricatured, as though it means requiring developing countries to adopt the same standards that rich countries enjoy. If that's what it really did mean, it would be hopeless: Poor countries, whose workers are less skilled and less productive than rich ones, can attract investment only if their wages are lower than those of industrialized nations. But the labor provision in the Jordan agreement merely says that each country must enforce its own labor laws and that failure to do so entitles the other nation to suspend the benefits of the trade deal. This is a mild provision. And the fact that Jordan agreed to it undermines one of the main arguments against labor clauses, which is that poor countries hate them.
Given this mildness, Republican critics should drop their objections to the Jordan deal. They should do so, moreover, because an attempt to dilute the labor clause would weaken the chances of getting Trade Promotion Authority (formerly known as fast track) through Congress. Democrats are attaching conditions to support for that trade-negotiating authority; some, such as their insistence that the administration swear fealty to the egregious anti-dumping statutes, ought to be resisted. But modest Democratic demands must be treated respectfully if the administration is serious about building a bipartisan trade consensus.
It is harder to say whether the Jordan deal should be seen as a model for future trade agreements. If other developing countries agree to similar labor provisions, that is all to the good: Many of the world's workers suffer appallingly harsh conditions, and anything that can be done to bolster laws against slavery, indentured labor and other extreme practices is clearly welcome. But if, as seems likely, most developing countries refuse to participate in trade talks that involve labor issues, the United States should not sacrifice the much bigger gains that trade liberalization offers.
Consider, first, the likely gains from including labor provisions in trade agreements. The Jordanian deal, which obliges Jordan to enforce its labor laws, is not an unqualified win: Jordanian law requires workers to get government permission before striking, and it is just as well that this restriction is not enforced rigorously. Moreover, it is doubtful whether trade sanctions are a useful way to force improvements in labor standards. The United States has failed to stamp out illegal sweat shops in cities such as New York and Los Angeles. Would foreign sanctions improve American compliance? Not likely.
In contrast, the benefits of freer trade -- including to poor workers -- are much more certain. By one estimate, a big multilateral deal centering on services and agriculture might put $2 trillion into American pockets over a decade, as well as giving developing nations a chance of graduating from dependence on American assistance. Because of the size of those gains, the administration must work harder than it is doing to launch a new international trade round. If that means assuaging developing countries that hate the trade and labor linkage, so be it. Freer trade must be the priority.
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