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What Would a Free Trade Agreement with the EU Look Like?

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In his 2013 State of the Union Address (SOTU), President Obama announced that the U.S. would soon begin talks on a “Trans-Atlantic Trade and Investment Partnership”—in other words, the U.S. will begin negotiating a “free trade agreement” (FTA) with the European Union (EU).

What would a trade agreement with Europe mean for America's working families?  Well, as with all trade agreements, it depends—specifically, it depends on the rules for trade and investment that are included in the agreement.  If the agreement focuses on reducing tariffs, it could indeed facilitate trade and perhaps even create jobs.  But if instead it focuses on tearing down laws and regulations that make workers safe, keep our food healthy and protect our air and water—then working families in the U.S. and EU will be the losers. 

As U.S. Trade Representative (USTR) Ron Kirk explained the day after the SOTU, the negotiations will focus on “tariffs and non-tariff barriers, and very importantly, looking at the regulatory barriers and the barriers that our different standards pose to further integration of our economy.”  Just what are non-tariff barriers (NTBs)?  Unfortunately, one person’s “barrier” is another person’s important public interest regulation.  NTBs, sometimes also called “behind the border barriers,” include things like labels indicating a product’s country-of-origin, whether tuna is dolphin-safe, or whether your breakfast cereal has genetically-modified corn in it.  NTBs can also include rules on the use of hormones and other drugs in meat for human consumption, flammability standards for apparel and vehicle safety testing.  While promoting regulatory cooperation to ease trade could be a great way to increase sales of U.S. products in Europe, using a U.S.-EU trade agreement simply to tear down product labeling and safety standards would not only harm America's and Europe's families—it would harm our democracies by putting one company’s desire to sell its products above societal decisions about health and safety. 

In another worrying development, Kirk stated that the agreement would pursue “substantial progress on . . . addressing liberalization in areas of service investment, labor and the environment . . .”  Rather than “liberalizing” labor (which typically means “increasing trade in” or “reducing standards in”), the AFL-CIO recommends that the Administration increase worker rights and protections in the FTA instead.  For example, instead of harmonizing regulations down to the lowest level, the U.S. and EU should work together to raise occupational safety and health standards and labor rights guarantees for all workers.  Ensuring that workers are safe on the job and freely able to organize and bargain for better wages and benefits is the best way to ensure that standards of living rise. 

While increasing trade ties with the EU could be beneficial for both American and European workers, as with all trade agreements, the rules matter—and the AFL-CIO will continue to advocate for people-centered trade rules promote shared prosperity, not just gains for the 1%.  To read more about the U.S.-EU trade agreement, visit our U.S.-EU Trade Agreement issue page

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