During his campaign for the Democratic presidential nomination, Barack Obama promised to seek the inclusion of environmental and labor standards within the text of the North American Free Trade Agreement (“NAFTA”). Indeed, NAFTA is the only trade agreement recently signed by the United States that does not include complete environmental and labor chapters that are directly linked to the treaty’s dispute-resolution mechanisms. Obama’s promise revived a debate that began sixteen years ago regarding the existence of a legitimate link between trade on the one hand and the environment and labor on the other.
The environmental and labor side agreements to NAFTA–the North American Agreement on Environmental Cooperation (“NAAEC”) and the North American Agreement on Labor Cooperation (“NAALC”)–have enforcement procedures that differ from those of the main agreement and that place limits on monetary enforcement assessments, with suspension of benefits for More recent bilateral U.S. trade agreements international noncompliance. include “fully enforceable commitment[s]” by all parties to maintain their environmental and labor laws and practices according to regulations, to refrain from their environmental and labor standards, to limit “‘prosecutorial’ and lowering ‘enforcement’ discretion,” and to apply “the same dispute settlement mechanisms or penalties available for other [free trade agreement (“FTA”)] obligations.”
Many of the FTAs that include environmental and labor dispute-resolution mechanisms are too recent–or have not even been ratified by the U.S. Congress–to provide a definite answer to the question of the effectiveness of such mechanisms. Although most criticism of the NAAEC and the NAALC has focused on the weakness of the enforcement mechanisms, this Article instead argues that the real failure is the agreements’ institutional shortcomings, which have inhibited the three NAFTA parties–the United States, Canada, and Mexico–from building a North American regime aimed at defending universally recognized labor values across the region. From this perspective, U.S. environmental and labor organizations’ goal of improving compliance with environmental and labor standards has not been achieved. Instead, the NAALC and, to a lesser extent, the NAAEC follow an adversarial, litigious approach to addressing environmental and labor challenges in North America. The emphasis that environmental and labor organizations, particularly from the United States, have placed on the more contentious dispute-resolution mechanisms as the key element in achieving effective enforcement of environmental and labor laws has indeed marginalized the roles that the Commission for Environmental Cooperation (“CEC”) and the Commission for Labor Cooperation (“CLC”) could have played as priority forums in the process of developing policies to address shared environmental and labor problems in North America.
This Article thus argues that linking the environmental and labor enforcement provisions to NAFTA’s dispute-resolution mechanisms could end up further inhibiting the development of a more fruitful collaborative agenda on labor issues–one with the capacity to enhance regional compliance with labor standards. The adversarial model that has so far predominated in labor and trade has prevented the three NAFTA parties from taking advantage of the opportunities for cooperation that naturally arise from geographic proximity, shared resources, high economic integration, and complementary labor markets and demographic dynamics.
