A sign of things to come? In what is being billed as an "embarassing setback" to President Bush, the House of Representatives failed to pass a bill normalizing trade relations with Vietnam, a precursor necessary for that country's accession to the WTO. The vote was 228 votes for and 161 against, but it needed a two-thirds majority to pass. Some 60 Republican House members voted no, while Democrats split evenly.
The punditry has been all over the map on this one, with some suggesting that the vote is proof of an imminent protectionist future, while others attribute the Republican nay-saying to lingering conservative resentment at the perfidious Viet Cong. The failure itself is mostly symbolic. The two-thirds requirement was a special circumstance mandated in special cases where debate on the merits of a proposed measure is foregone. Another vote is scheduled for later this week under normal rules, and unless a significant number of representatives change their minds, the bill is considered a sure thing to pass on its second try.
What are we to make of the split decision by Democrats? In the aftermath of the midterm elections, few economic issues have inspired more consternation among normally sober economists than the specter of protectionist Democrats running amok and destabilizing the global economy. The Vietnam vote, then, became an immediate litmus test: Does this mean House Democrats are smelling blood? When their new comrades arrive in January, will they be even further emboldened?
What this analysis misses is that enthusiasm for free trade has been declining in Congress for years, already. The reason, as noted in this space repeatedly, is that if you take the time to examine the details of deals cut by the U.S. in bilateral free trade agreements, as well as pursued in multilateral forums like the WTO, you understand immediately that they are being crafted to serve the needs of special interests, and are not designed to promote the general welfare. Leave it to Le Dung, spokesman for Vietnam's Foreign Affairs Ministry, to sum up the nut of the matter: The vote, he said, failed "to meet with the interest and aspiration of the two countries, especially the interest of U.S. business."
Economists can crunch all the data they want to prove the benefits of free trade, but in politics, perception is king. And if the people perceive that big business benefits from trade deals while they don't, politicians will pay attention, no matter what party they're from.
Meanwhile, in other WTO news, U. S. Trade Representative Susan Schwab declared that Russia and the U.S. have agreed to a deal that will allow Russia to join the trade organization (provided Georgia agrees too, but that's a whole 'nother story.) But last I checked, the notorious Russian MP3 downloading site, allofmp3.com, is still alive and kicking.
Is it time to start the allofmp3.com deathwatch? Schwab has stated, loudly and clearly, that the den of downloading inquity is the root of all music copyright evil, and the U.S. has been adamant that the site must be shut down if Russia wants to join the big boy's trading club. But none of the news stories I've read on the subject has indicated that Russia made any explicit promise to close it down, (although there are vague references to specific actions Russia must take to tidy its intellectual property affairs.)
In the final days of the original incarnation of Napster, music fans frantically downloaded as much as they could carry before the site closed the doors. Are in-the-know Russians making similar raids on allofmp3.com?
P.S.: To the would-be letter-writers who are now chafing at the bit ready to blast me for my hatred of musicians who want to make a living and my condonement of foul piracy, let me just say this: How the World Works is a regular iTunes shopper and has never indulged in allofmp3.com's services (nor, for that matter, did HTWW ever nab a song from Napster.) But I find it of enduring interest that a downloading site is one of the sticking issues in the normalization of trade relations between two great nations with such a history of superpower entanglement as the U.S. and Russia, and I'm desperate to find out how the story ends.
UPDATE: Wednesday morning's news is that the House Republican leadership has now withdrawn the Vietnam trade bill, amid an explosion of partisan bickering.