Free Trade versus Good Food
How the World Trade Organization struck down Country of Origin Labeling for meat
Eager to chalk up some second-term accomplishments, the Obama administration is busy with the final negotiating stages of a sweeping free trade deal called the Trans-Pacific Partnership. Although many of the details of the agreement remain secret, a lot of progressives and environmental groups are worried about the broad outlines of the deal. If you care about creating a more sustainable food system, you should be worried, too. Let me explain.
Photo by Bob Nichols/USDA
First, some background . The Trans-Pacific Partnership (or TPP) is one of the largest free trade regimes ever conceived. It would include 12 Pacific Rim countries — among them Australia, Chile, Japan, Malaysia, and the United States — and link more closely together some 40 percent of the global economy. In a bit of Clinton-era triangulation, the White House is hoping it can bring together centrist Democrats and the business wing of the Republican Party to get enough votes to squeak this deal through Congress. If the agreement has any chance of passing, it will need that kind of cross-aisle support, because a lot of the president’s core supporters don’t like what they see in the TPP.
Labor unions, a bedrock Democratic constituency, have long hated free trade deals, which they say give added protections to international investors and huge transnational corporations while off-shoring good jobs to low-wage companies. Writing last month in the Los Angeles Times, AFL-CIO president Richard Trumka and Robert Reich, the Berkeley professor and former Clinton administration labor secretary, warned: “Following NAFTA [the North American Free Trade Agreement] with the Trans-Pacific Partnership is like turning a bad television show into a terrible movie.”
Environmentalists are also anxious about the TPP. Here’s Michael Brune, executive director of the Sierra Club, writing at The Huffington Post: The implications of [the TPP] are profound: Corporate profits are more important than protections for clean air, clean water, climate stability, workers' rights, and more.”
Unions and green groups are especially nervous about the way in which the TPP would expand what are called Investor-State Dispute Settlements, or ISDS. What exactly is an ISDS, and why is it so controversial? Senator Elizabeth Warren, the Massachusetts Democrat, explained the idea not too long ago in an oped for The Washington Post:
“ISDS would allow foreign companies to challenge US laws — and potentially to pick up huge payouts from taxpayers — without ever stepping foot in a US court. Here’s how it would work. Imagine that the United States bans a toxic chemical that is often added to gasoline because of its health and environmental consequences. If a foreign company that makes the toxic chemical opposes the law, it would normally have to challenge it in a US court. But with ISDS, the company could skip the US courts and go before an international panel of arbitrators. If the company won, the ruling couldn’t be challenged in US courts, and the arbitration panel could require American taxpayers to cough up millions — and even billions — of dollars in damages.”
Recent disclosures about the type of ISDS contained in the TPP have fueled opposition to the deal. While progressives like Warren fear giving new powers to corporations eager to roll back government regulations, conservatives don’t like the idea of surrendering American sovereignty to international tribunals. Because of this simmering hostility, the Obama administration is pushing for so-called “fast track authority” that would make it easier to get the trade deal through Congress. As Reich and Trumka explain it, “If the administration gets fast-track authority, it could hand a completed deal to Congress, which must then vote yes or no, without amendments and little debate, within 90 days.”
TPP, ISDS, NAFTA, fast-track — what does all of this have to do with the food system? Well, an ongoing trade dispute involving meat-labeling shows that worries about free trade aren’t just an academic dispute. An existing international trade deal is already attacking your ability to know where, exactly, your food comes from.
The United States is currently in a trade fight with Canada and Mexico over a US law that requires Country of Origin Labeling on most fresh meat, fish, vegetables, and nuts sold here. Country of Origin Labeling (or COOL) was enacted in 2002 after years of grassroots lobbying by consumer organizations and some of the largest US farm groups. The law, which went into effect in 2009, requires that retailers include a label on the food package that states the country in which the fresh meat, fish, or vegetable was raised or grown.
The country of origin rules were barely in place when Canada filed a dispute (since joined by Mexico) under the World Trade Organization (WTO) complaining that the meat labeling requirements were a “technical barrier to trade.” A WTO dispute panel agreed with Canada’s complaint. The US appealed the decision, and the WTO then dismissed the appeal and ordered the US to rewrite the labeling law or face retaliatory tariffs from Canada and Mexico.
In 2013 the USDA rewrote the labeling rules in an effort to comply with the WTO decision. Canada and Mexico then filed a new complaint, which the US again lost and again appealed. A new decision from the WTO is expected in May. In the meantime, US lawmakers must decide whether to (once again) amend a US law to comply with WTO rules, or suffer a minor trade war.
Last week, the House Agriculture Committee’s Livestock and Foreign Agriculture Subcommittee held a hearing to consider the issue. Big business groups and major meat packers and processors are urging Congress to ditch Country of Original Labeling. “The only way to avert costly retaliation is for Congress to approve legislation repealing the COOL requirement for muscle cuts of meat,” Christopher Wenk of the US Chamber of Commerce told Members of Congress. But some farmers’ organizations are urging lawmakers to hold strong. “Congress should not listen to the overblown rhetoric and retaliatory threats made by foreign government officials and the meatpackers,” Robert Johnson, president of the National Farmers Union, said. “The WTO has stated multiple times that countries have a right to label products with their country of origin … We urge Congress to allow the WTO process to run its course.” More than 200 consumer and agriculture groups — including Consumers Union and the National Family Farm Coalition — are backing the Farmers Union’s demand to protect COOL.
This isn’t the first time a WTO has struck at a food labeling law. In the late 1980s, tuna canning companies voluntarily put in place a “dolphin-safe tuna” to address the huge numbers of bottlenose dolphins that were then being caught in tuna nets. The label was later codified in US law and, eventually, targeted by Mexico as a barrier to trade. For more than 20 years, the US and Mexico have been battling in trade tribunals over the dolphin-safe label, with the WTO consistently ruling against the label and the US repeatedly appealing. (Disclosure: Earth Island Institute, the publisher of Earth Island Journal, initiated the dolphin-safe label in the eighties and today acts as an independent verifier of tuna-fishing boats.)
According to free trade critics, the WTO’s persistent antagonism to food labeling is evidence of trade deals run amok. “How far are the tentacles of so-called ‘free trade’ going to reach, if we can no longer provide basic information to consumers and let them make choices,” Ben Beachy, a policy analyst with Public Citizen’s Global Trade Watch, said to me. “All we are doing is providing people with more information. And yet the [trade] rules are so expansive that a label about where their food comes from can be challenged and ruled as violation of trade policy. Is it really a trade violation to know that our beef came from Canada?”
Or, perhaps more to the point: What’s so objectionable about a consumer’s right to know? Isn’t transparency supposed to be one of the foundations of a free and open marketplace?
In theory, of course, the answer is Yes. And just as transparency is a core requirement of a functioning marketplace, transparency is also among the essential ingredients for creating a sustainable food system. Think of rancher Joe Salatin’s idea of the open abattoir — an open-aired slaughterhouse that is open to the public, and therefore an antidote to the secretive practices of the big meat packing conglomerates. Or remember the classic slogan, “Know Your Farmer, Know Your Food.” If you’re shopping at Safeway or Vons or Publix, it’s difficult to really know your farmer. But by knowing the country in which your food was raised and grown, you can at least get one step closer to that ideal. Country of Original Labeling makes the food system a smidgen more transparent.
Canadian and Mexican meat producers complain that meat labeling is costly and discriminatory. You know what? They’re right. And more discriminating eaters are exactly what we need to reform our food and agriculture systems. As eaters, we need to exercise more discernment — to ask where our food came from, who grew it, and how. Such questions are a natural part of a vibrant food marketplace.
The free trade dispute panels’ apparent disagreement with the ideal of the discriminating consumer makes me wonder: Exactly whose interests are these trade deals meant to serve?