Crafting a Social Dimension in a Hemispheric Trade Agreement

Abstract

The breakdown of negotiations on a Free Trade Area of the Americas creates an opportunity to rethink trade-labor linkage in the Americas.1 In this rethinking, what can advocates of a strong social dimension in hemispheric economic integration learn from existing regional trade regimes in North and South America? The lessons drive a policy choice between rejection and engagement. Choosing rejection, critics can point to flaws in existing labor-trade linkages: NAFTA’s labor side agreement, the North American Agreement on Labor Cooperation (NAALC), and Mercosur’s Social-Labor Declaration. All signatory countries show job and wage stagnation, growing inequality in labor markets, and continuing problems of serious violations of workers’ rights. Review of these instruments leads critics to conclude that an effective workers’ rights regime in trade agreements is an impossible goal. Instead, advocates should reject the globalization model and push to strengthen national economic frameworks in which citizens can influence a democratic political process.