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You must subordinate human rights to free trade.

What's wrong with the WTO?
You must subordinate human rights to free trade.

The WTO weakens the power of citizens to champion human and labor rights through the policies of their governments.
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Opinions

"We renew our commitment to the observance of internationally recognized core labour standards. The International Labour Organization (ILO) is the competent body to set and deal with these standards, and we affirm our support for its work in promoting them. We believe that economic growth and development fostered by increased trade and further trade liberalization contribute to the promotion of these standards. We reject the use of labour standards for protectionist purposes, and agree that the comparative advantage of countries, particularly low-wage developing countries, must in no way be put into question."

—WTO Singapore Ministerial Declaration - 13 December 1996

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"The battle against the unfreedom of bound labor is important in many third world countries today for some of the same reasons the American Civil War was momentous."

—Amartya Sen, Nobel Prize-winning economist

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"If the actions of Massachusetts, which put the human rights of the Burmese people above the interests of a few multinational companies, do not comply with WTO rules, then the WTO rules need changing, not the actions of Massachusetts."

—Bill Jordan, general secretary, International Confederation of Free Trade Unions

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"The current system of global trade and investment rules has failed miserably on many counts. It has weakened the bargaining power of workers all over the world, has undermined legitimate national regulations designed to protect the environment and public health, and has exacerbated financial instability and growing inequality worldwide. We need a rules-based global trading system that protects workers' and human rights, the environment, communities' priorities, public health, and consumers."

—AFL-CIO President John J. Sweeney, U.S.

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"Fortunately, there is much agreement already over the substance of core labor rights. Last year, business, labor and government representatives from 173 nations reaffirmed core labor standards as fundamental human rights, including freedom of association and the right to organize and bargain collectively. They also called for the elimination of forced labor, child labor, and employment-related discrimination. Virtually every independent labor federation has endorsed the ICFTU's [International Confederation of Free Trade Unions] call for building labor rights into the global trading system. The divide is not between North and South; it is between workers everywhere and the great concentrations of capital and the governments they dominate."

—Jay Mazur, President, UNITE (Union of Needletrades, Industrial and Textile Employees), Chair of AFL-CIO International Affairs Committee, U.S.

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"The rules of the currently 137-member WTO, the two authors said, 'reflect an agenda that serves only to promote dominant corporatist interests that already monopolize the area of international trade.'"

"Human rights, they added, were given only an oblique reference in the founding documents of the WTO, which was launched at an international conference in Marrakesh in 1994 to replace the old General Agreement on Tariffs and Trade (GATT)."

"'The net result is that for certain sectors of humanity—particularly the developing countries of the South—the WTO is a veritable nightmare,' the jurists declared."

—Reuters story quoting J. Oloka-Onyango of Uganda and Deepika Udagama of Sri Lanka, authors of a United Nations report on trade and human rights

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"The WTO's rule is not restricted to such matters as tariff barriers. When the organization was formed, environmental and labor groups warned that the WTO would soon be rendering decisions on essential matters of public policy. This has proven absolutely correct. Currently, the WTO is considering whether "selective purchasing" laws—like a Massachusetts law barring state agencies and local governments from buying products made in Burma and intended to withdraw an economic lifeline to that country's dictatorship—are a violation of "free trade." It is feared that the WTO will rule out these kinds of political motives from government policy making. The organization has already ruled against Europe for banning hormone-treated beef and against Japan for prohibiting pesticide-laden apples."

—Ellen Frank in Dollars and Sense, a magazine of popular economics, U.S.
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Basic principles of the WTO, such as most-favored nation status (MFN) and blindness to production and processing methods (PPM), prohibit distinguishing among trading partners because of bad human or labor rights records. For example, a congressional study has confirmed that a proposed U.S. law banning the importation of products made with child labor would violate the General Agreement on Tariffs and Trade, the main WTO treaty. This is because child labor is a production method, not a physical property of the product.

Already, U.S. federal courts have cited WTO challenges in striking down a "selective-purchasing" law passed by Massachusetts that denied government contracts to companies doing business with the military government of Myanmar, a notorious human-rights violator. Europe and Japan had begun dispute-settlement proceedings against the law in the WTO, which they dropped when the U.S. courts ruled the legislation unconstitutional.

In 1998, the Maryland state legislature also narrowly defeated a similar law targeting the Nigerian dictatorship. The Clinton administration lobbied heavily against the legislation, focusing on potential challenges to it under the WTO.

The elimination of such legal leverage weakens the power of citizens to defend human rights through the policies of their governments. For example, the widespread government sanctions against South Africa's apartheid system would probably have been illegal under the WTO.

The United Nations Sub-Commission on the Promotion and Protection of Human Rights, meeting in August 2001, adopted three resolutions expressing concern about the impact on human rights of the liberalization of trade in services, the expansion of intellectual property rights, and other trade-related aspects of globalization.

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Legal Basis

The following treaties are enforced by the World Trade Organization.

General Agreement on Tariffs and Trade 1947 (GATT 1947)

See GATT page.

Article I - Most-Favored Nation Treatment (MFN)

Article III - National Treatment (non-discrimination between domestic and foreign products).

Agreement on Trade Related Investment Measures (TRIMS)

See TRIMS page.

Agreement on Technical Barriers to Trade (TBT)

See TBT page.

Agreement on Government Procurement (AGP)

See AGP page.

The Agreement on Government Procurement (AGP) prohibits members who have signed it from withholding government contracts on basis of labor, human rights or environmental standards. Companies or nations who violate these cannot be discriminated against in procurement.

Some exceptions to the non-discrimination principles of national treatment and most-favored nation status have become widely accepted around the world. In recognition of this, government procurement practices have not been covered by previous trade agreements. Although some procurement standards may violate non-discrimination principles, they generally do this in order to further legitimate policy goals such as fair employment, a living wage, or encouraging local businesses in poor communities.

The AGP, however, turns these exceptions into illegal trade barriers. It also prohibits withholding government contracts from companies or nations that violate labor or human rights or environmental standards. Under it, for example, government support for the international boycott against South African apartheid probably would have been illegal.

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Cases & Controversies

TBT, AGP & TRIMS

AGP

  • Defeat of Maryland sanctions against Nigerian dictatorship by Clinton administration lobbying
    While the Myanmar case was pending, state legislators in Maryland proposed selective-purchasing legislation prohibiting the state from doing business with the military dictatorship of Nigeria or with firms operating there.
    The Clinton administration lobbied heavily against the law. A State Department official testified: “All State and local sanctions are perceived to violate the rules [of the WTO], they can cause counterproductive disagreements. … [W]e would like to work with you to ensure that we don’t expose ourselves to a potential WTO challenge.”
    The law had initially been favored to pass; after the Clinton lobbying campaign, it lost by one vote.
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Resources

Non-governmental

Governmental

Official WTO Web site

By Peter Costantini ~ Seattle ~ November 2001
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