Everything you need to know about the WTO

While thousands of protesters gather outside, there's plenty of disagreement inside, too.

Topics: Environment, 2000 Elections, Unemployment,

All this week, protesters will besiege the World Trade Organization with
rallies, marches, teach-ins, street theater and civil disobedience as the
top trade officials from its 134 member countries meet in Seattle. But while the conflict
outside the meeting may be more entertaining, there is plenty of division within the group, which has become the main global body promoting and enforcing
free trade rules. And some of the arguments inside the WTO mirror those
being made on the streets.

The WTO is under wide-ranging attack for sins of omission and commission — from
neglecting poor countries and worker rights to endangering old forests and
sea turtles and trampling on democracy. But there’s serious disagreement on a wide range of issues among WTO member countries themselves. Despite months of talks at the WTO’s sedate headquarters in Geneva, leaders could not agree on a pre-conference statement of intentions for a new round of negotiations to reduce tariffs and change trading rules, for instance. Now even this new round of talks — which the big economic powers all endorse in some form — is in jeopardy.

If the upcoming negotiations collapse, it would be a serious blow to President Clinton, who has been unable to persuade
other leading heads of government to join him in Seattle to revive prospects for a new round of talks. It could, as a result, indirectly tarnish Vice President Al Gore. But Gore — who is staying far away from Seattle — might lose more if a new round is launched, because it would probably ignite more protest from labor, environmentalists and other constituencies that he needs.

How the WTO took center stage, igniting international protest and even influencing the American presidential elections, is a story in itself. For most of the past 50 years, international trade debates drew a yawn from the average citizen, as governments bit by bit reduced tariffs and other restrictions on international trade. But in the United
States, a variety of trade-related issues — swelling trade deficits, job losses blamed on global trade and investment, a wave of transnational corporate mergers, hot-button
controversies over NAFTA and China’s trading status, and anxieties about
the environmental effects of free trade decisions — have made more
people edgily aware that the decisions of trade bureaucrats can hit home in
surprising ways. Still other Americans look to global production and
marketing as the engine of a new American century, and want the global body to rebuff the demands for restraint coming from international protesters today.

Internationally, of course, Europe, Canada and Japan hope the WTO can boost their prosperity — and at the same time offer some protection for their national cultures against the United States’ global media and entertainment empire. Developing countries have still other interests: Most feel they gained too little from past negotiations, and that the rich countries have resisted opening up their markets rapidly enough to imports of the clothes, shoes, textiles and other goods the poorer nations produce. And many, but not all, view attempts to expand Western standards of labor rights and environmentalism as a new imperialism that will retard their economic growth.

Whatever side you’re on, it’s clear that the rules written at the WTO are driven by strong national interests, which in turn reflect important blocs of voters and even more powerful corporate interests. The United States, for example, has given top priority to trying to keep Internet businesses as free of taxes and regulations as possible, reflecting the desire of
government negotiators to protect the worldwide dominance of U.S. Internet businesses.

And while the United States purports to be a force for greater environmental sensitivity in the global trade body — standing up for dolphins in the tuna trade debate, for instance — the U.S. trade representative is lobbying against European Union proposals requiring manufacturers of computers and other electronic equipment sold in Europe to phase out the use of toxic chemicals and to take back discarded components for recycling. In fact, the
American Electronics Association wants the United States to file a complaint about such demands under WTO.

Another big issue that will likely divide the WTO this week is agriculture. The
United States and a group of leading agricultural exporting countries want Europe to eliminate massive subsidies to agriculture, and hope Japan will abandon its various means of protecting farmers. But Europe and Japan, with some support from developing countries, want the WTO to recognize farming as “multifunctional” — producing food and fiber but also securing rural social life and the environment. Europeans are also up in arms over genetically altered food.

One issue the United States and European Union tend to agree on is the need to do more to protect worker rights. The Clinton government has long argued for some modest links between expanding trade and workers’ rights, and this year the European Union — whose members have tilted more to the center-left in recent elections — also supports such moves. These leaders are driven more by political necessity than conviction: Increasingly they think that the global trading system as a whole will lose popular support in developed countries if it is seen as leading to third-world sweatshops and rising inequality around the world.

But many developing nations object to introducing questions about workers’ rights or the environment into trade talks, saying such issues will be used by rich countries to block their exports. If China enters the WTO, it will add its substantial weight to the bloc of
countries — including Mexico, Egypt, India and Pakistan — that already strenuously object to discussing labor rights.

There are still other divisions. Where the U.S. negotiators are focused on a few core
issues such as agriculture and the Internet, the European Union wants the upcoming “millennial round” of negotiations to be more expansive, providing opportunities for wheeling and dealing on a wide range of issues, and potentially expanding WTO jurisdiction further over rules governing the rights of investors. The United States has shied away from a comprehensive discussion of investment policies, since negotiations on a
multilateral agreement on investment failed last year even among the world’s rich countries.

Developing nations want the next round to include an assessment of the impact of WTO
rules, especially in areas such as the protection of intellectual property. While the richer countries see such rules as protection of their inventions and copyrights, the poor countries often see them as disrupting traditional agriculture (as more plants and animals are patented, for example) or interfering with efforts to provide cheap medicine (such as drugs to
control AIDS in South Africa).

WTO critics on the outside are divided on strategy, even as they
agree about the trade body’s shortcomings. Some, including most of the big U.S.
environmental and labor groups, hope to reform WTO rules to protect
consumers, workers, the environment and national sovereignty. These “fair traders” argue that unrestricted free trade leads to a race to the bottom, with countries competing to reduce regulations that protect the environment or hold down wages and restrict unions in order to

They want the WTO to give priority to national and international
environmental laws and to use its powers to enforce internationally
recognized workers’ rights. For example, while most countries have committed
themselves to certain core labor rights — preventing child labor, forced
labor and discrimination, and guaranteeing the right of workers to organize –
the WTO could actually penalize countries that don’t adhere to such standards.

In a Nov. 19 speech at the National Press Club, AFL-CIO president John Sweeney said that organized labor would not support a new round of negotiations if it did not incorporate
protection of workers’ rights, the environment and consumers, give citizens more of a voice at the WTO, protect public health and environment laws from WTO rulings, and ensure that governments could protect against surges of imports or dumping of products below cost. “The real debate is not over whether to be part of the global economy, but over what are the rules for that economy and who makes them,” Sweeney said.

Other critics think that the WTO is fatally flawed — too undemocratic,
too pro-corporate, too biased in favor of trade above everything, and too
dominated by the rich countries. They want to roll back or eliminate the
WTO, and don’t trust it to do anything worthwhile — even on behalf of their
causes, whether it’s protecting arctic forests or the right of Indonesian workers to organize unions.

“I don’t believe the WTO as it is can be reformed,” argues Steelworkers union president George Becker. “The whole thing needs to be scrapped and started all over.” Even if worker rights are protected, he argues, it will take many decades for workers in poor
countries to improve their wages and social welfare laws.

These critics point to the track record of the WTO panels charged with settling disputes that come before the organization when one member country challenges laws of
another as unfairly impeding trade. So far, according to a report by Lori Wallach and Michelle Sforza of Public Citizen, the watchdog group founded by Ralph Nader, “no democratically achieved environmental, health, food safety or environmental law challenged at the WTO has ever been upheld. All have been declared barriers to trade.”

The WTO overturned U.S. regulations promoting cleaner gasoline, for example, and ruled that Europe could not ban American beef grown with artificial hormones. In many cases,
governments have dropped or watered down regulations simply because of the threat of a WTO challenge; subjects of such challenges have included Guatemalan rules to discourage misleading promotion of infant formula, Korean food safety laws and a bill before the Maryland legislature to boycott goods from Nigeria because of the country’s human rights violations.

While leaders of developing nations oppose expanding worker rights and environmental protections, union organizers and democracy advocates in these poorer countries
are trying to link up with Western labor and environmental groups, arguing that their own leaders rely on suppressing unions and keeping down wages as a way of attracting international investment and keeping democracy at bay. Some Western unions claim these tactics should be treated as an illegal subsidy to business under WTO rules, and that the international body should penalize the offending countries.

Going into this week’s WTO meetings, it appears that the protesters have American
public opinion on their side. A recent survey by the Program on International Policy Attitudes at the University of Maryland showed that 93 percent of Americans thought that “countries that are part of international trade agreements should be required to
maintain minimum standards for working conditions.” The survey showed
that while Americans are open to free trade and globalization, they think that corporations rather than working people have benefited most from these trends; respondents say they are willing to slow down trade — and even pay somewhat higher prices — to protect American jobs, support worker rights around the world and preserve the environment.

Increasingly, it seems, the divisions at the WTO are not the kind of questions that can be settled by trading tariff reductions in a lawyer-filled back room. More fundamental issues about the nature of the new global economy are coming to the fore and spilling into the streets of Seattle.

David Moberg is a senior editor at In These Times and a fellow at the Nation Institute.

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