Linking labor standards to trade sanctions could hurt poor nations

[Omaha Steve]

http://www.democratandchronicle.com/article/20090103/OPINION02/901030320/1008/OPINION

January 3, 2009

American shoppers have been outraged to learn that some of the Chinese-made products they purchased might have been manufactured by prison labor. More generally, American labor unions such as the AFL-CIO have alleged that China's persistent denial of workers' rights gives it an unfair cost advantage in the international arena.

This has increasingly given rise to calls to link international trade and labor standards. This means it would be desirable to bring about an institutional arrangement in which rights to trade are made conditional upon the promotion of labor standards.

Simply put, if the Chinese want to export to the lucrative American market, then they'd better put in place a minimal system of workers' rights or else we would be free to use tariffs and/or quotas to retaliate against them.

But this linkage is likely to be self-defeating because nations are likely to strategically use the possibilities for restricting imports provided by linkage to protect their domestic producers and hurt those elsewhere. As a result, trade opportunities available to poor nations will lessen and the world trading system will gradually become subordinated to powerful interests.

The problem with linkage is that proponents would like to use a single institution, the World Trade Organization, to accomplish two objectives, namely, the maximization of the gains from free trade and the attainment of improvements in workers' rights. It would be better to de-link these two objectives and to use the WTO and the International Labor Organization to accomplish them.

FULL story at link.

I'm looking forward to the comments on this story.

[pscot]

1. The world trading system is already subordinated to powerful interests

We need to do whatever it takes to protect American workers, and we need to do it now. We can worry about the global impact later, and take steps to mitigate it if needed. If our trade policies continue to undermine American workers, we'll be in no position to help anyone else.

[Earth Bound Misfit]

2. As opposed to those "developing countries" who employ

"race to the bottom" human rights standards to increase their "competitive edge".

An incredible price to pay for cheap CRAP from Wal-Mart.



K & R

[David Ricardo]

3. Rational Actor Principles...

suggest someone wouldn't do something unless they felt it made them better off. Low wages and crappy conditions might suck, but if they suck so much, why did the workers take the jobs?

[Earth Bound Misfit]

4. ??? The "cold Pizza employees" post gets 200 views

and 8 responses, this one....not so much????

:shrug: