By Jay Chittooran
With a deal reached on trade promotion authority (TPA, or fast track), pro-trade and anti-trade advocates are ramping up their case. But amid this ongoing battle is a surprising player who desperately wants a deal to go down: China.
Critics of TPP often warn that it will hurt blue-collar workers in the United States and weaken labor standards globally. Supporters believe TPP will create net new manufacturing and service-sector jobs while also raising global standards, particularly labor protections. They point to substantially improved U.S. trade balances in the blue collar goods sector for trade deals concluded since 2000.
One thing is indisputable: If the U.S. doesn’t write the trade rules in the Asia-Pacific region, another country will. China is that country and it’s already well on its way.
China is working to forge the Regional Comprehensive Economic Partnership, its own regional trade agreement with roughly the same size and scope as TPP that excludes the United States. Its goal: undercut the American-led TPP and the high-standard rules that the U.S. will demand for the region.
Because of that, China would love a "no" vote on American fast track and American-led TPP. And in no sector is that more apparent than with American labor.
While the poor labor conditions inside China have received a lot of attention — from not enforcing worker safety laws to finding children working in factories — there’s not been a systematic look at how China writes their labor rules in their trade agreements. Until now.
We examined all of China’s trade deals since 2000 — 13 agreements with more than 20 countries in 1,849 pages — and compared them to the U.S.’s 17 trade deals over the same time period. And what we found should worry every American worker.
First, the 13 Chinese trade deals have non-existent or very poor labor standards. In eight of the agreements, there is not a single mention of labor standards. In fact, the words “labor” or “worker” do not appear at all. In the other five, labor standards are weak and unenforceable. Some trade deals include side agreements calling for cooperation—but they’re non-binding and lack teeth. There’s no guarantee that conditions must be met nor are there penalties for violations. It’s no wonder that in all of China’s FTAs, the words “labor” and “worker” appear just 17 times.
Second, it is widely believed that the China-led RCEP will have no labor standards at all. The chair of the negotiations has been clear that the goal of the agreement is only tariff reduction — not worker protections — and multiple first-hand accounts confirm that. Also, countries will be able to use a flexibility principle, which will allow trade rules to be ignored — labor or otherwise — should a country experience difficulty meeting terms of the deal.
U.S. trade deals are unquestionably better for labor. When you compare China’s deals to the 17 U.S. trade deals completed since 2000, every single American deal has stronger labor protections, enforcement, and monitoring mechanisms. And given that TPP is being negotiated to have the highest standards ever, it should stay this way.
Let there be no mistake — there is a race underway in Asia, with TPP and RCEP sprinting toward the finish line. But those two racers have two wildly different economic visions. Whichever country wins will take the lead in writing the rules in Asia, and whoever that author is will have a profound effect on labor. That’s why China would love a no vote on fast track and TPP, which would lock in their nonexistent labor standards that clearly haven’t and will not protect workers. A no vote cedes the race to them in the world’s fastest-growing region and leaves our workers in the dust.
But it doesn’t have to be this way. The modern American trade deals have committed to strong labor protections, monitoring, and enforcement mechanisms. And with TPA and TPP set to continue that precedent, it’s about time we tell China that we’ll take the gold.
Jay Chittooran is Policy Advisor for the Economic Program at the centrist think tank Third Way.
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