In his column in New York Times Tuesday, Thomas L. Friedman urged the US congress to ratify the Free Trade Zone agreement reached with Jordan, commending the Arab country as a staunch ally of the US. However, he said that the deal will make no have no affect on the US economy due to the small volume of trade exchanges involved.
Following is the text of the article:
The US Congress has a chance to do something really good for an American ally and really interesting for global trade with one vote. And it has the chance to do something really reckless for both by shying away from this vote. Hold your breath and hope for the best.
This story starts with Jordan, the desert kingdom whose exports to the U.S. probably don't equal Michael Jordan's annual salary from endorsements. But Jordan's savvy young King Abdullah (who arrives in Washington today) figured out sooner than most of his Arab colleagues that trade, not aid, was the way to grow his country, drive domestic reform and differentiate Jordan from the oil states. After the peace treaty with Israel, Jordan arranged with the US to set up several small free-trade zones inside the country, and they have already produced 13,000 new jobs - a big deal for a country with no oil.
So last year Jordan worked out a total free-trade treaty with the Clinton team - becoming only the fourth country in the world to do so (after Canada, Mexico and Israel) and the first in the Arab world. This is a treaty worth supporting. Jordan is a staunch US ally, it is democratizing through real parliamentary elections, it treats its people with decency and it is a critical buffer state between Iraq, Syria and Israel. A free-trade deal with Jordan would not cost jobs here, but would attract investment to Jordan and establish it as a model in the region. (Egypt's president, Hosni Mubarak, is now also asking for a free-trade deal with the US, and that too should be supported.)
Given all this, you would assume the Jordan free-trade treaty would be easily ratified by Congress. I wish. When President Clinton's trade representative, Charlene Barshefsky, negotiated the accord she persuaded the Jordanians to include an innovation that the US labor movement had long sought - provisions to ensure minimum labor and environmental standards at Jordanian or US factories engaged in their trade. Never before have such provisions been written into a US free-trade agreement, with trade sanction penalties for non-compliance.
Labor and environmental groups argue that trade accords shouldn't just regulate trade, but also how goods and services are made. Some advocates of this approach are well-meaning. Others are nothing more than shells for US labor unions who really want to block trade with poor, developing countries but don't want to admit it. So instead they say, "Gosh, we'd love to trade with you, but only when you get your labor and environmental rules up to ours."
This is known as politically correct protectionism, and both developing countries and Republicans hate it. Hence the current dilemma: Does the Bush team push a Jordan free- trade deal that is important for U.S. national security but includes pro- labor, Clinton-installed provisions? Or does it let the accord languish?
How about a compromise? Enter Robert Zoellick, Mr. Bush's trade negotiator. Mr. Zoellick knows he could ram the Jordan deal through Congress stripped of its labor and environmental rules, given the Republican majorities. But he doesn't want to, because he's going to need bipartisan support if he wants Congress to back larger trade accords.
So Mr. Zoellick is now exploring a compromise with all sides, which was first suggested by the House Ways and Means chairman, Bill Thomas. The idea is to keep the labor and environment provisions in the Jordan deal, but instead of having trade sanctions imposed if one side doesn't live up to its commitments, there would be financial penalties instead. (Countries would have to donate money to a labor or environmental organization to work on the violation).
"The approach I'm exploring," says Mr. Zoellick, "would treat trade, labor and environment exactly the same, which is what labor and Democrats have long advocated. But let's do it with monetary penalties for non-compliance - not trade sanctions, which many Republicans, businesses and developing countries object to as a cover for protectionism. Let's strike a trade deal that encourages people to have core labor standards and environmental improvements, without building in provisions that block trade, which is the very engine of growth that will, over time, lead to better labor and environmental conditions."
This is a good idea. This is an important trade accord, and it could be a good precedent for the future. Congress should act on it now.
© 2001 Al Bawaba (www.albawaba.com)
