Free Trade and the Environment

The core of Martin and Kathleen Feldstein’s argument is that environmental protection is a luxury that can be dispensed with by non-affluent societies (“Environmental Purists May Be Mexico’s Curse,” Commentary, April 16).

It is truly disturbing that the evidence of recent decades concerning destruction of tropical forests, global climate change, water and air contamination and ozone depletion has failed to make even some eminent economists grasp the truth that pollution is a real and unavoidable cost of production. The Feldsteins write that it wouldn’t be fair to ask Mexico to pay for those costs until some indeterminate time in the future, after the damage is done. They are wrong on two points.

First, environmentalists are seeking provisions in a free-trade agreement adopting the “polluter pays” principle. Industry attracted to Mexico under the terms of an agreement would be required to either prevent or clean up unacceptable levels of pollution. Other costs may be met by public debt reduction in return for environmental improvements. Second, wide experience has demonstrated that stopping pollution before it occurs (as in treating sewage) is far less costly than rehabilitation.

The Feldsteins seem genuinely upset at the notion that U.S. environmental standards should be applied in Mexico. That is not what environmentalists are asking for. Harmonization of standards, including environmental standards, is a principle of any free-trade agreement. The goal environmentalists seek is that over time, equivalent standards be adopted based upon whichever nation’s standards are stronger.

The price of pollution should not be shifted for payment to future generations. The theory of grabbing the profit first and deferring the debt to later should be scrapped, on both economic and environmental grounds. We must pay the full costs of our own economic activity, and that includes the costs of pollution. A free-trade agreement with Mexico and Canada that enforces this principle will receive environmentalists’ support.

JAY D. HAIR, President

National Wildlife Federation

Washington, D.C.