The effort to break the U.S. trade policy deadlock must start from a better understanding of the challenges the United States faces in its commercial relations with developing countries. Hard-line free traders who insist there is a direct causal link between trade liberalization, growth, and improved labor and environmental standards in developing countries defy growing evidence from mainstream economists suggesting that the relationships among these factors are much more complex. Recent research shows that, contrary to free-market orthodoxy, government intervention is often needed to ensure that growth does not increase inequality. Furthermore, many environmental and labor conditions that impact international commerce are policy determined. That qualifies them for consideration in trade negotiations.
Free traders have yet to offer a convincing answer to that question.
Some labor leaders and environmentalists can be criticized for a similarly mistaken assessment of what the United States confronts in its trade relations with developing countries. But hard-line activists often seem unwilling to acknowledge that their preferred policy outcome is not achievable in the near or medium term, particularly in the area of labor rights. Given this opening position, it is difficult to imagine the WTO reaching consensus anytime soon on rule changes that would permit the use of trade sanctions to enforce labor standards. Many labor activists are well aware of the positions of developing country governments. They argue that these positions can be changed, in part by strengthening independent labor unions.