Environment and Labor in Trade

1. Environment and Labor in Trade Kydin Nourazar

2. Overview • Should labor and environmental standards be addressed in trade agreements (WTO)? • Position of labor supporters in trade • Position of environmental supporters in trade • Position of opponents/U.S. • Presidential candidates • Central Issue • Policy Proposal

3. Should the WTO address labor and environmental issues? • Supporters vs. Opponents • Supporters believe the WTO should address these social standards to improve labor rights and to protect the environment. • Opponents believe the WTO should not address social factors because it can reduce trade opportunities.

4. Supporters of Labor Standards in Trade Workers being exploited -Forced labor -Child labor a. 246 million children between the ages of 5-17 working worldwide. b. Majority in Sub-Saharan Africa, Asia, and Latin America. Poor Working Condition -Dangerous working environment a. Detrimental to physical and mental health. -Low wages a. Many laborers in these developing nations make below US$2 per day. -Lack of labor rights a. Freedom of Association b. Collective Bargaining Articles XX and XXIII of GATT - Article XX a. General exceptions to restricting international trade if it affects public morale or harms human life or health. b. Restricts trade if products come from prison labor. - Article XXIII a. when workers rights are nullified or impaired, the GATT would require the mischievous party to make adjustments or major changes in their labor standards to coincide with the WTO principles.

5. Supporters of Environmental Standards in Trade Goods being produced for trade have negative effect on the environment. -Deforestation -Air and water pollution -Climate change -Threatens endangered species Generally supported by developed nations that are politically and economically stable Argue that environmental challenges have no borders and impact all of the world. Articles XX and XXIII of GATT also apply -Article XX a. international trade can be restricted if it causes harm to human, animal or plant life. -Article XXIII a. when the environment is being damaged, the GATT would require the mischievous party to make adjustments or major changes in their environmental standards to coincide with the WTO principles. Intellectual Property (IP) -If IP laws are incorporated into WTO to protect creator’s rights then environmental and labor rules should be incorporated into WTO to protect worker rights and the environment.

6. Supporters of Labor and Environmental Standards in Trade • Moral obligation • Many believe addressing environmental and labor standards is morally responsible. • Public Opinion • About 9/10 Americans support requiring countries that sign trade agreements to meet minimum labor and environmental standards.

7. Opponents of Environmental and Labor Standards in Trade and U.S. Position U.S. interest to promote global free trade. Addressing social standards is a form of protectionism and would hurt trade. Majority of WTO members are developing nations that rely on trade: - for economic growth - to fight poverty - to bring political, social, and economic stability In the long run free trade will improve environmental and working conditions. WTO was not designed to address non-traditional trade issues. - Risk of increasing protectionism - Too many different interests and ideas Environmental and Labor responsibilities should be left to more qualified international institutions that can deal with these issues in a more effective way. - International Labor Organization (ILO) - UN Environmental Organization (UNEO)

8. Presidential Candidate: McCain • Keep Environmental and labor standards out of WTO • Promote free trade: Approve treaties with Colombia, Panama and South Korea and hammer out a trade deal with the European Union to open foreign markets to U.S. goods and create jobs at home for companies that export those goods. Do not insist on environmental and labor standards, which could block free trade by making other countries reluctant to negotiate. • Support NAFTA: Retain the North American Free Trade Agreement with Canada and Mexico as is, without environmental and workplace standards, and encourage more trade with Mexico and Canada. • Approve CAFTA: Pressure Congress to approve the Central American Free Trade Agreement to create markets for U.S. goods and strengthen the economies of America's neighbors. The agreement was negotiated by the Bush administration but has not been approved by Congress.

9. Presidential Candidate: Obama • Believes we can work within WTO framework to address environmental and labor standards. • Seek "fair" trade: Negotiate trade agreements with other countries but insist on labor and environmental standards to curb pollution and prevent abusive working conditions. Pressure other countries to eliminate subsidies for exports, which give them a price advantage in the world and U.S. marketplace. • Amend NAFTA: Renegotiate this agreement to impose labor and environmental standards. • Block CAFTA: Reject this agreement, largely because it does not impose labor and environmental standards. • Important not to only view things, “through the lens of Wall Street, but also Main Street, which means we've got strong labor standards and strong environmental standards and safety standards”.

10. Central Issue Implementing environmental and labor measures would expose the trading system to great risk. Rule-based multilateral trading systems like the WTO were designed to promote trade liberalization and would not be effective in dealing with social standards.

11. Policy Proposal Shift responsibility to the ILO and UNEO, which have the structural organization and experience to tackle these issues. Enhance power of ILO and UNEO - Expand the size of the organizations a. For greater oversight - Increase budgetary resources a. Research and Development b. Publicity - Have organizations work with other international institutions and NGOs. a. Attend committee meetings b. Hold lectures, panels and rallies Daily focus on environmental and labor issues

12. Policy Proposal (Cont’d) ILO is a very influential organization. - Recommended sanction against Burma for failing to follow labor standards. With enhanced power it can be more effective in enforcing labor standards and pressuring violators of labor rights. UNEO is an extension of the UN Environment Programme (UNEP). - Created to give greater control over global environmental activities. - Better structural organization that will help coordinate government action, promote funding, and research ways to spread new technologies. Currently the top emitters of greenhouse gases that are not UNEO members are the United States, China, Russia, China and India. - UNEO must come up with fair and realistic goals that would ask these nations to gradually reduce emissions within a long time period. Main objective: ILO and UNEO must up with appropriate standard that will keep both developing and develop countries’ interests in mind.

13. Policy Proposal (Cont’d) • U.S. must play the role of a global leader and encourage the world to invest in green technology. • Green Technology will help the world environmentally and economically • Environmental benefits: • Reduces greenhouse gases • Slows climate change • Reduce air and water pollution • Protects human, animal, and plant health • Economic benefits: • Create more jobs • Boost trade • Increase in FDI • Help firms and workers • Reduce dependency on foreign sources of energy

14. Works Cited • “An Introduction to Trade and Environment in the WTO”. World Trade Organization. <http://www.wto.int/english/tratop_e/envir_e/envt_intro_e.htm> • “Barack Obama on Free Trade”. On the Issues. 19 October 2008. <http://www.ontheissues.org/2008/Barack_Obama_Free_Trade.htm> • “CAFTA”. Wikipedia. < http://en.wikipedia.org/wiki/CAFTA> • “Child Labor”. P.A.P. Blog. 15 May 2008. <http://filipspagnoli.wordpress.com/2008/05/15/human-rights-cartoon-80/> • “Intellectual Property”. Wikipedia. <http://en.wikipedia.org/wiki/Intellectual_property> • “John McCain on Free Trade”. On the Issues. 19 October 2008. <http://www.ontheissues.org/2008/John_McCain_Free_Trade.htm> • “Kyoto Protocol”. Wikipedia. < http://en.wikipedia.org/wiki/Kyoto_protocol> • “Labor Standards and Trade Agreements”. Institute for International Economics. <http://www.petersoninstitute.org/publications/chapters_preview/338/4iie3322.pdf> • “Obama Says He Wants to Renegotiate NAFTA: Candidate Says He Won't Force Others to Talk”. Truth About Trade & Technology. 26 October 2008. http://www.truthabouttrade.org/content/view/12611/54/ • “Trade, Labor & the Environment: Preview of the IMF/World Bank Meetings”. The Brookings Institutions. 11 April 2000. <http://www.brookings.edu/events/2000/0411trade.aspx> • Charnovitz, Stephen. “Addressing Environmental and Labor Issues in the World Trade Organization”. Progressive Policy Institute. 1 November 1999. <http://www.ppionline.org/ppi_ci.cfm?knlgAreaID=108&subsecID=128&contentID=649> • Doyle, Alister. “46 Nations Call for Tougher U.N. Role”. Reuters. 3 February 2007. <http://www.reuters.com/article/environmentNews/idUSL0335755320070204> • Grace, Brewster. “WTO Trade & Labor Standards”. Foreign Policy in Focus 5. 15. April 2000. <http://www.fpif.org/briefs/vol5/v5n15wtolabor.html> • Macan-Markar, Marwaan. “ILO Cracks the Whip at Yangon”. Asia Times Online. 29 March 2005. <http://www.atimes.com/atimes/Southeast_Asia/GC29Ae02.html> • Palmer, Doug. “WTO Needs New Labour, Environmental Rules – Clinton, Obama”. Planet Ark. 3 March 2008. <http://www.planetark.com/avantgo/dailynewsstory.cfm?newsid=47314> • Tom. “Top Greenhouse Gas Emitters…China, US, Indonesia, and Brazil”. MyTechVision. 16 May 2007. <http://mytechvision.wordpress.com/2007/05/16/top-greenhouse-gas-emitters-china-us-indonesia-and-brazil/> • Wells, Gary J. “Trade Agreements: A Pro/Con Analysis of Including Core Labor Standards”. U.S. Department of State. 11 May 2001. <http://fpc.state.gov/6119.htm>