Will A Social Clause In Trade Agreements Advance International Solidarity?

David Bacon

November 30 the AFL-CIO mobilized thousands of union members to
demonstrate in Seattle outside the meeting of trade ministers of the
World Trade Organization. The labor federation called for incorporating
the rights of working people around the world into the text of future
trade agreements, and for treating the impact of trade on workers as a
fundamental issue.

But the
AFL-CIO is proposing a way of dealing with trade with which a number of
unions disagree. It proposes a social clause, which would incorporate
into future trade agreements core labor standards, including
prohibitions against child labor and prison labor, against
discrimination, and against violations of the right of workers to
organize unions and bargain. The WTO enforcement process, now used to
protect the ability of transnational corporations to move investments
and production freely across borders, would then be used to protect
workers’ rights as well, the labor federation argues.

But many
unions, including left-wing ones in Europe and Canada, have serious
questions about the proposal for a social clause. Some equate it with
proposals in Europe to create a social contract between labor and
capital as part of the process of creating a single European economy.

social contract has tended to be a proposal of Europe’s more
conservative unions. The more radical ones have argued for opposing the
process of merging economies itself, rather than negotiating worker
protections within an economic framework dominated by transnational
corporations and banks. In Europe, the movement towards a single
currency and the merger of markets has brought with it austerity
formulas and the elimination of social benefits and protections won by
workers over the last fifty years.

democrats are now in power in Britain, France, Germany, and Italy. In
some of those countries workers and unions have been able to reverse the
economic trend, and some governments have been more responsive to worker
pressure than others. But all these social democratic governments argue
that for Europe to make it in the world economy, productivity has to be
increased, and social needs and benefits brought into line. That often
brings the governing parties into basic conflict with the working-class
base which has brought them to power. The conflict is not so different
from that which has taken shape in the U.S. between labor and the
Clinton administration.

The flaw
in the social democratic argument is that its assumption and purpose is
wrong. Society exists to serve the social needs of people, not the
productivity needs of capital. Those two needs are in basic conflict—a
conflict of class interest.

criticism made by the Canadian Labour Congress of the proposal for a
social clause in the WTO negotiations is similar. "The struggle by
unions, social justice groups and environmentalists is about more than
just winning a seat at the table, or a ‘social clause’ or
environmental rules," a CLC statement declares. "We’re determined
to change the entire trade regime."

however, that negotiating a set of basic international labor rights or
standards is a good idea, in the context of trade negotiations it
especially requires that labor agree on a common agenda. The social
clause, or the set of core labor standards, the AFL-CIO proposes
reflects the perspective of unions in a wealthy, industrial country.
Unions and labor in other countries see other needs which go beyond
them, especially the need for economic development.

of farmworker families in the Philippines and Mexico, for instance,
overwhelmingly would prefer that their kids have the opportunity to go
to school rather than work. But simply prohibiting child labor doesn’t
provide that opportunity. It just cuts the income families depends on to

countries are the source of immigrants who work in the first world.
Their remittances are often a large source of national income,
especially income which goes directly to the families of workers and
farmers, rather than trickling through the pockets of government and
banks. The status of that expatriate population and its right to work,
therefore, is a basic labor rights question for developing countries,
and one which affects directly the income of their working class

current definition of what the social clause should cover is too narrow,
reminescent of the land reform proposals of the AFL-CIO in El Salvador
during the civil war or of the Sullivan Principles in South Africa.
While labor rights are important, there’s a bigger struggle going
on—over who controls the economies of developing countries, and what
development program they can follow.

federations in developing countries propose a large variety of programs
for economic development. The more conservative generally support
foreign investment and the governments which encourage it, even
governments which keep minimum wages at starvation level, and suppress
the efforts of workers to organize, especially in export industries.
More radical unions support a program of national development which
seeks to protect local industries, and even keep them in public, rather
than private, hands. They support policies which encourage the formation
of an internal, national market, based on the rising income of workers
and farmers.

development programs are the antithesis of the economic framework the
WTO enforces. The international institutions supported by the U.S.
government, from the WTO to the IMF, do everything in their power to
keep developing countries from exploring these alternatives. Those
governments which do pursue them become pariahs in the international
trade system, eventually subject to sanctions, and even called "rogue
nations." Unless the international trade structure is changed
drastically, these national development alternatives will not be
possible. So proposing a social clause within that trade structure, even
one which limits the prerogatives of foreign investors, undermines
proposals for nationalization and national development less dependent on
transnational capital, and those unions which support them.

unions need to negotiate a common agenda with labor in developing
countries and recognize and respect differences of perspective and
opinion. Saying, for instance, that the All China Federation of Trade
Unions is not a legitimate union body because it doesn’t agree with
the AFL-CIO’s trade agenda is a form of national chauvinism and smacks
of the old cold war prohibitions and destabilizations. It is also very
short-sighted from the perspective of forging a common front against
transnational corporations who seek to whipsaw workers and take
advantage of differences in standards of living from country to country.

The big
problem in the new (or old) international economic order is the
difference in the standard of living between wealthy and poor countries.
The difference between Mexico and the U.S., which was about 3:1 in the
1950s, is about 16:1 today. That difference is the cause of the loss of
U.S. jobs as corporations relocate production. So long as this huge gulf
exists, U.S. workers will continue to have that problem, social clause
or no.

unions can seek to talk with the Chinese or Mexicans or Salvadorans or
Cubans, and urge them not to rely on transnational corporations as a
source of capital for economic development, and should do so. If they
have cooperative relationships based on mutual respect and
self-interest, they will have a more receptive audience than they will
if they treat people with whom they disagree as though they had no right
to exist.

labor is no longer in the cold war era in many ways, and one of the most
important is that it no longer defends free trade internationally, as it
did in the days of AFL-CIO presidents George Meany and Lane Kirkland. In
fact, the AFL-CIO now urges the labor movements of developing countries
to oppose policies by their governments which encourage foreign
investment at any cost, converting their economies into export
platforms, depressing wages, violating union rights, putting up national
resources and enterprises for privatization to the highest bidder, and
generally treating their workforce as a source of cheap labor for sale
to international capital. This path is what the AFL-CIO now calls "the
race to the bottom."

So why,
then, offer political support to the very international structure which
has those economic goals?

The big
problem facing U.S. workers in the global economy doesn’t come from
the policies of foreign labor federations or even the governments of
developing countries. Its source is much closer to home. U.S. economic
and trade policy has a greater influence on the widening global gulf in
income than any other single factor. That, of course, is our

Clinton administration, which just a couple of years ago was unwilling
to discuss any labor protection in trade agreements, has seen a certain
reality. Addressing (whether in real or just PR terms) the worst of the
abuses in foreign factories is a way of deflecting domestic pressure. As
unionists and young activists were gassed in Seattle streets, Clinton
signed with great fanfare a watered-down prohibition of the worst forms
of child labor, lecturing developing countries about their need to be
concerned for labor rights. Yet this and previous administrations have
refused to fight for the ratification of the dozens of ILO conventions
which have been negotiated over the last 50 years (including a much
stronger prohibition on child labor), and have no intention of doing so
in the future.

bottom, U.S. governments of both political parties have had no interest
in addressing the fundamental problem of poverty in the developing
world, and the role their policies play in perpetuating it. In fact, if
anything, Clinton’s newfound interest in labor standards is a way of
enabling the implementation of those same policies. The Labor
Department, for instance, proposes a garment code of conduct which
prohibits extreme abuses in Central American sweatshops. The
corporations which violate its code are not included on the list of
responsible manufacturers. The ones that abide by the code are praised.

But the
proposals for standards and codes of conduct leave unasked a basic
question—where does the poverty come from that forces workers through
the factory doors? What policies are pursued by the U.S. government that
perpetuate that poverty? Seeking to avoid these questions, the
administration proposes to negotiate over limits on the worst abuses
(not necessarily as the workers of those countries define them), so long
as U.S. labor basically accepts an international trade structure and
economic order which institutionalizes the global gulf in the standard
of living, and the impoverishment of whole nations.

Since the
AFL-CIO has already endorsed the candidate who proposes these same
economic and trade policies, there’s a certain political convenience
involved, to say the least.

alternative to the argument for labor standards, enforced by the WTO, is
international labor solidarity. Solidarity is actually the official
policy of the AFL-CIO, which renamed its international policy arm the
American Center for International Labor Solidarity. But the goals of
U.S. labor solidarity could be based on a set of ideas much broader than
the agenda pursued at in negotiating with Clinton over labor standards
at the WTO. Those ideas might include:

1. Negotiate an
agenda (including the terms of social clauses), based on mutual
respect and self-interest, with the unions and workers of all

2. Accept the
legitimacy of existing unions—no cold war prohibitions or
destabilization programs. Develop friendly and cooperative
relationships based on dealing with common employers, and with the
effect of U.S. trade and economic policies on the people of the
country involved.

3. Oppose the
negotiation of new trade agreements, and demand the restructuring of
the international economic order.

4. Make attacking
the difference in standards of living from country to country a
primary objective of AFL-CIO policy, reexamining the role U.S.
economic, political and military policy plays in reinforcing that
difference. Labor solidarity means opposing U.S. foreign policy in
areas where it has led to drastic decline in living standards, such
as the economic reforms in eastern Europe. 

5. Make
independence from U.S. foreign policy a matter of principle,
including ending subsidies for AFL-CIO programs from USAID, NED
or other government institutions. The AFL-CIO should be unafraid
to publicly criticize imperial policies like the U.S.
counterinsurgency program in Columbia, economic and military
sanctions in Iraq and Serbia, and the economic blockade of Cuba.

6. Respect
differences in cultural and social norms, including different
social systems. Some countries believe in the rehabilitation of
prisoners through socially useful work, for instance, (a
principle supported in the past by U.S. prison reformers as
well). At the same time, prisons shouldn’t be turned into
commercial workhouses, and workers shouldn’t have to compete
against the products of unpaid labor.

7. Prohibitions
against some forms of labor, such as child labor, need to
include alternatives which will actually raise the incomes of
the families affected, so that they can survive without the
earnings of children.

8. Support an
independent system for the enforcement of labor standards—not
the WTO system which should be opposed on principle. The WTO
structure is controled by developed countries, and used to
impose an unjust international economic order on developing
ones. It is unrealistic to expect that same structure to ensure
economic justice. Calling for it to do so alienates those people
who are its victims, and raises the possibility that
international labor standards could be used as the pretext for
economic aggression in trade wars.

International labor standards should include those that affect
people in the U.S. and developed countries, as well as
developing countries. U.S. working people, for instance, need a
prohibition on strikebreaking, living wages, the right to free
health care, the elimination of mandatory overtime, an end to
welfare reform, and protection for the rights of immigrants.