NCPA - National Center for Policy Analysis

Trade Pact With Jordan Establishes Dangerous New Precedent

January 26, 2001

During his last days in office, President Clinton hammered out a free-trade pact with Jordan that has analysts and the business community concerned. It represents the first time the U.S. has made trade directly contingent on both countries enforcing their own environmental and labor laws.

Analyst Sterling Burnett of the National Center for Policy Analysis explains why the Jordan pact is a worrisome departure:

  • This is the first agreement where environment and labor conditions were actually written into the treaty opening up free trade.
  • Labor and environmental issues have been pursued in separate agreements -- not mixed together.
  • But in agreements like this one, if the U.S. has an advantage in the balance of trade the other party could say, "Hold it, we don't think you're enforcing the Endangered Species Act adequately, or protecting your public lands adequately... so we're going to see you in this court."
  • So both countries could use environmental and labor issues as disguised protectionism.

The AFL-CIO and the Sierra Club -- which have opposed trade pacts such as NAFTA -- are boosting the Jordan pact. The U.S. Chamber of Commerce has warned that it may oppose the agreement if President Bush does not renegotiate it and take out the provisions.

Source: John Berlau, "New Trade Deal With Jordan Raises Free-Traders' Hackles," Investor's Business Daily, January 26, 2001.


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