Foes on the Right Exaggerate NAFTA's Environmental Clout
Taylor, Jerry, Insight on the News
It is no surprise that the hounds of protectionism and xenophobia are in hot pursuit of their prey, the North American Free Trade Agreement. Braying discordantly with the pack, however, are free traders upset with NAFTA's environmental accord and related side agreement on environmental protection. Those green articles of NAFTA, the pack snarls, represent the most fundamental threat to sovereignty ever faced by this nation -- an "economic Maastricht," no less.
Although it is true that NAFTA's environmental stipulations are unnecessary and counterproductive for both trade liberalization and ecological protection, they've been so brazenly misrepresented by anti-NAFTA conservatives that the perception of what's in the agreement has virtually nothing to do with what it really says.
Articles 756 and 1114 of the main agreement, for example, are said to mandate the "upward harmonization" of environmental regulations in Canada, Mexico and the United States while prohibiting the parties from ever relaxing their domestic environmental standards. Yet Article 756 deals with "sanitary or phytosanitary standards," such as food handling and inspection regulations, so that Mexican imports of chicken, for example, are capable of meeting American standards for consumer safety.
Article 1114, on the other hand, does note that it is "inappropriate to encourage investment by relaxing domestic health, safety or environmental measures. Accordingly, a party should not waive or otherwise derogate from such measures" in order to encourage investment. And what if, for example, America were to do such a thing? Well, Mexico and Canada are empowered under 1114 to "request consultation ... with a view to avoid any such encouragement."
Now, saying that nations "should not" relax standards to increase investment is not the same as saying that nations cannot do so. Moreover, it is apparently not considered inappropriate to lower environmental standards if they are needlessly strict on their own merits. Finally, the consequence of relaxing standards to increase investment is to become subject to a consultation of parties who are not empowered to do anything except talk. Clearly, Article 1114 is puffery for the benefit of the environmental lobby.
The environmental side agreement to NAFTA is similarly far more sop than substance. Despite U.S. Trade Representative Mickey Kantor's public line that "no nation can lower labor or environmental standards, only raise them," the text of the agreement says no such thing. In fact, it repeatedly states that nations have the right to establish whatever level of environmental regulation they find appropriate.
The preamble, for example, reaffirms "the sovereign right of States to exploit their own resources pursuant to their own environmental and development policies." Article 10 further recognizes "the right of each Party to establish its own levels of domestic environmental protection and environmental development policies and priorities, and to adopt or modify accordingly its environmental statutes and regulations. …