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Enron Mail |
The discussion of free trade I circulated was short of discussion of some
hot topics these days. Here is a continuation on environmental and labor rights. Environmental issues Pat: The US had laws only permitting imported products if caught in ways friendly to sea turtles and dolphins. The WTO principle of regulating products but not production processes ruled these laws out of bounds. Chris: Some countries compete for companies to locate production facilities by having lower environmental standards. Thus, free trade puts poor nations in competition with each other, halting them from regulating environmental standards. Instead, we see a "race to the bottom" where environmental regulations are lax. Pat: But a poor nation should be able to choose its own level of regulations. If lower regulations produces more jobs, why shouldn't a poor nation be free to pick laxer regulation and less starvation? Chris: Well, I am unsure of your definition of "nation." In many poor nations, the people who suffer from pollution are not informed of the hazards and are not very politically powerful. Instead, they are just poor people who live downstream from a horrific factory or mine. Pat: I acknowledge some regimes are undemocratic. I just am unsure if restricting trade with them will help the poor people you and I both care about. Chris: Speaking of undemocratic, the same "race to the bottom" shows up in labor rights. Nations with effective laws restricting child labor are at a disadvantage to competitors where such laws are not enforced. Similarly, nations win the game of attracting foreign investors if they shoot union leaders and otherwise restrict employees' rights. Moreover, slave labor remains present in some nations with various forms of indentured servitude. The WTO makes it illegal to sanction nations based on these horrific practices. Pat: Like you I oppose 10 years old in dangerous factories, slavery, and shooting or imprisoning union leaders. I just do not think trade barriers are a very effective solution to most of these problems. Children do not work because their parents are mean, but because they are poor. Restricting their work makes no sense and does not help them. If rich nations want children in poor nations to go to school, we should be subsidizing meals and tuition for schools in poor parts of the world, not restricting poor families' already limited options. Chris: So would you permit ANY deviations from widely agreed-on labor standards. According to your logic we should have have permitted trade with Nazi Germany, just as you would encourage trade with China in spite of its horrific human rights abuses. Pat: We again agree on the horror of China and other nations' abuse of human rights. At the same time, WTO membership and a rising standard of living seem the most likely ways to help democratic reformers in China. I remain unsure why we should undertake actions that hurt this opening process, even if it assuages our conscience. LINKS: Here is a short video clip of Laura Tyson and others discussing the WTO http://www.cnn.com/video/world/1999/11/30/rd.wto.101.reut.rm28.html For more critiques, read the speech by the head of the AFL-CIO at http://www.aflcio.org/publ/speech99/sp1119.htm As you'd expect, a more favorable view is from the National Assoc. of Manfuacturers, http://www.nam.org/Revolve/WTO.html "Clearing the Air: The WTO and America's Health, Safety and Environment" yahoo has a nice listing: http://fullcoverage.yahoo.com/fc/Business/Trade/ David I. Levine Associate professor Haas School of Business ph: 510/642-1697 University of California fax: 510/643-1420 Berkeley CA 94720-1900 email: levine@haas.berkeley.edu http://web.haas.berkeley.edu/www/levine/
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