Labor rules pivotal in Dems’ stance on Bush trade deals

As many as 150 House Democrats could vote for several trade agreements the Bush administration has negotiated if it relents to Democratic demands for tightened labor rules, according to Rep. Sandy Levin (D-Mich.).

In an interview with The Hill, Levin defended the Democratic demands from critics who have charged the agreements would lead to significant changes to U.S. and state labor laws. “It’s not our motivation, and that will not be the result,” said Levin, who also sought to dispel charges that he is opposed to liberalizing trade.

In a reference to organized labor, Levin said he and other Democratic leaders on trade have voted favorably for some trade bills despite opposition from groups he said were important to the Democratic Party.

Having 150 Democrats vote in favor of a trade agreement would be a huge change from recent congressional trade votes, in which deals were approved almost entirely with Republican support. For example, only 15 Democrats voted for the Central American Free Trade Agreement, while 22 supported a deal with Oman with little economic impact on the U.S.
The pattern has put some House Republicans in difficult positions, as some have been pressured by leaders to vote in favor of deals to make up for the lack of Democratic support.

To win more Democratic votes, Levin said the administration will have to agree to labor demands set out in a Democratic trade policy unveiled last month by Levin and Ways and Means Committee Chairman Charles Rangel (D-N.Y.). The policy calls for International Labor Organization principles to be incorporated into pending U.S. trade deals with South Korea, Peru, Panama and Colombia.

“We’re not going to back off,” Levin said in the interview. “If globalization is going to work, you have to spread the benefits, and workers have to be part of the equation.”

Democrats also want changes to other provisions in the deals affecting rules on the environment and provisions protecting drug patents that are opposed by U.S. drug companies. However, business sources predicted the labor demands would be the most difficult to parse, and Levin said he thought the other issues could be resolved.

So far, neither the Bush administration nor House Republican leaders have rejected the proposal, but Levin said U.S. trade officials have not responded with a meaningful offer on labor. Most business groups have not publicly criticized the proposal, but have suggested privately that the demands could lead to massive changes in U.S. and state labor laws that could spark an outcry in state legislatures. They also suggest the demands could cost trade deals Republican votes.

Georgetown University professor Theodore Moran and Gary Hufbauer, a fellow at the Peterson Institute of International Economics, argued that the demands could lead to labor law changes in a March 13 Financial Times column. In an interview, Hufbauer acknowledged it was unlikely a trade partner would challenge a U.S. labor law. Yet he noted it was more than a hypothetical possibility, since a future administration might be sympathetic to calls from labor that U.S. laws should be strengthened, and might tolerate a challenge.

Basic ILO principles include the right to bargain collectively, the elimination of forced labor and the abolition of child labor. Incorporating them into trade deals would require the U.S. and its partners to meet these standards in order for parties to receive a deal’s benefits. Either party could be challenged by the other if it were failing to do so.

Thea Lee of the AFL-CIO also said the possibility that a foreign government would bring and win a trade case against the U.S. based on a U.S. labor law was a long-shot. But she said certain U.S. laws allowing the use of prison labor or the permanent replacement of striking workers could be found to be in violation of ILO principles.

As a result, including ILO principles in trade deals would increase pressure on the U.S. to improve its labor laws, “and that’s a good thing,” Lee said. Inclusion would “shine a spotlight on ways the U.S. is out of compliance.”

Levin, however, insisted critics are wrong and U.S. laws are in compliance with ILO standards, particularly when compared to potential trade partners like Peru and Colombia. He said a government challenging that notion would have to meet the high hurdle of proving that a U.S. law not only was noncompliant, but was affecting trade. When asked about the prison-labor example, Levin suggested it would be difficult to show that laws allowing prison labor are affecting trade.

He noted that language Democrats are requesting is similar to provisions in a trade deal with Jordan approved in 2001. That deal was negotiated by the Clinton administration, but was approved by voice vote in Congress in 2001, and Levin noted that no challenges have been brought against U.S. labor laws under that deal. 

Arguments that the demands could lead to labor-law changes “are a straw man,” Levin said, and just the latest effort to thwart a long-standing Democratic demand to change U.S. trade policy.