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Fast Track: The Real Issue

By Jerome I. Levinson
Thursday, November 6, 1997; Page A23


Bob Dole's op-ed piece arguing for "fast-track" legislation [Nov. 3] is as notable for what it doesn't discuss as what it does, and it provides an important clue as to the real issue in this debate. The question is not whether, as Dole would have it, we are to be fully engaged in the global economy. Rather, it is on what terms we engage. And at the center of that question is the issue of workers' rights – precisely the issue Dole ignores.

Workers' rights is at the heart of the House Democratic leadership's objection to the proposal that came out of the House Ways and Means Committee, with the support of the Clinton administration. That legislation precludes the administration from negotiating worker rights (and environmental conditions) in the main body of whatever agreement is finally proposed for approval by Congress.

Supporters of fast track tend to avoid this issue, perhaps for good reason; it would require defending the indefensible. First, the agreements proposed for negotiation are not trade agreements, they are trade and investment agreements, and in the case of the North American Free Trade Agreement (NAFTA), the investment provisions are at least as important as the trade aspects.

The provisions on investment in Chapter 11 of NAFTA are directed at Mexico. They prohibit Mexico from imposing (1) restrictions on corporate ownership and (2) requirements of local content in manufactured goods, transfer of technology or nationality of senior management – all of which had been characteristic of Mexican policy before NAFTA. Chapter 17 of NAFTA required Mexico to completely change its law governing intellectual property to something approximating American standards. These two chapters are integral parts of NAFTA; violations are subject to drastic penalties and detailed dispute-resolution procedures.

In contrast, provisions governing worker rights (and the environment) were relegated to "side agreements" having no legal bridge to NAFTA. There are thus no consequences for a party violating the side agreements. Moreover, the procedures for invoking provisions of the labor and environmental agreements are, as the chief Mexican negotiator assured Mexican businessmen, so ill defined and convoluted that they have remained largely a dead letter.

In other words, there is a complete lack of proportionality in NAFTA – this in an agreement that serves as the model for the president's free trade and investment initiative for the Western Hemisphere. Everything is done for the protection of corporate property rights, while workers' rights and environmental considerations are relegated to a secondary plane of importance. If the fast-track legislation now being considered does not contain specific terms of reference changing these priorities for future negotiations, we can expect more of the same and even worse.

Why are workers' rights and environmental conditions important? Because without them we are going to see an acceleration of current trends toward the degrading of both. President Clinton recognized this risk in his October 1992 speech approving of NAFTA on condition it included labor and environmental agreements.

In fact, those agreements did not require any change in Mexico's existing labor or environmental laws. They merely called for each party to commit itself to enforcement of its own labor and environmental laws and constitution – something that Clinton himself acknowledged had been sorely lacking. Unfortunately, as previously noted, those agreements have proved ineffectual.

The overriding issue in the fast-track debate is whether the international trade and investment regime is going to have some minimal balance that protects not only corporate property rights but also core worker rights – such as the right to free association and collective bargaining – as well as environmental standards. As currently conceived, it does no such thing.

With respect to the alarmist aspect of Bob Dole's article – that the United States runs the risk of being excluded from important markets, particularly in Latin America – there is little substance to such fears. Brazil's and Chile's exports are divided relatively equally among the United States, Japan and Western Europe. More recently, an increasing percentage within the region has involved the Southern Cone regional trading bloc, known as Mercosur. They, as well as the other countries in this hemisphere are much too sophisticated to cut themselves off from the most open and lucrative consumer market in the world: the U.S. market.

Indeed, perhaps the most notable aspect of the fast-track debate is the singular lack of urgency among the Brazilian and Mexican authorities for initiating negotiations extending NAFTA, or for a Hemispheric free trade agreement – a sharp contrast to the efforts of those working to stampede the U.S. Congress into approving this fatally flawed proposal.

The writer is a professor of international law at American University.

© Copyright 1997 The Washington Post Company

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