It has been almost 20 years since the continuing tension between free trade and environmental protection flared following the creation of the World Trade Organization (WTO) and the ratification during the Clinton Administration of the North American Free Trade Agreement (NAFTA). That tension—between economists, investors and manufacturers favoring the elimination of most constraints on international trade and environmentalists (and labor advocates) fearful of a “race to the bottom” by countries competing for new factories—has once again taken center stage in a struggle that is threatening to derail the proposed Trans-Pacific Partnership (TPP) agreement.

The TPP, a proposed free trade and investment agreement among the United States and 11 other Pacific countries from Asia and the Americas, is the Obama administration's most significant international economic initiative and the centerpiece of its so-called “pivot to Asia.” This column reviews the principal environmental issues in dispute concerning the TPP and suggests possible approaches to resolving those issues.

Background

Despite the misgivings of some environmentalists and the active opposition of the Sierra Club, the U.S. ratified the WTO agreements because they were the culmination of many years of planning and cajoling by U.S. policymakers to reduce barriers to international trade, with the prospect of both expanded markets for U.S. manufacturers (and consumers) and increased prosperity for developing countries. Moreover, the WTO included, in Article XX of the General Agreement on Tariffs and Trade (GATT), specific protection for environmental measures designed to protect public health, exhaustible natural resources and threatened species.