My friend Jonathan Dingel has more on the Columbian trade agreement. He quotes Bernard Gordon on the proliferation of non-trade-related provisions in “free trade” agreements:
These cases highlight the problems of incorporating non-trade issues into trade agreements. Labor and environmental standards began the practice, but no clear end-points now exist. That recalls Jagdish Bhagwati’s famous warning that “the spaghetti bowl effect” (by which he meant overlapping rules of origin) would make FTAs hopelessly complex and impossible to administer. Today we would add the “Christmas Tree Effect,” the term used in Congress for the many items, each individually attractive though unrelated to a bill’s main purpose, that are added to satisfy special interests. Similar baubles and ornaments characterize today’s world of proliferating FTAs, and will be sought by powerful negotiating partners. Along with the profoundly dangerous capacity of FTAs to revive a world of blocs, they are among the best reasons to maintain instead the global trade system.
I should note that there’s a lively debate among free traders about the relative merits of bilateral versus global trade agreements. My esteemed colleague Dan Griswold has argued that under the right conditions, bilateral agreements can help jump-start broader liberalizations. But I think both sides should be able to agree that loading these agreements up with terms that have no detectable connection to trade is a bad idea.
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