SOYOUWANNA KNOW ABOUT THE WTO?

3. HEAR SOME ARGUMENTS AGAINST THE WTO

"The putative goal of globalization is a smokescreen that allows supranational elites (such as multinational corporations) to take power away from individuals, and the WTO is their willing co-conspirator."

The Argument: It has become a visual trope, the photo of the Third World city (Cairo, Bangkok, Mexico City, what have you) showing ragamuffin kids playing in squalid streets beside their shanties, with gleaming office towers and hotels not two hundred yards distant in the background. These photos are intended to shock us with the inequities of the global economy. You'd better believe they're not airbrushed.

We're blind to the power usurped by the multinational corporations (MNCs) because their role in politics is veiled from public view. They're accountable only to boards of directors and shareholders. The MNCs only value stability for their commercial activities. Our cleverest leaders learn to play it safe. Does anyone remember Clinton's health care drive? But look how popular he's been since he gave up trying to accomplish anything besides stabilizing and growing the economy.

And yet globalization brings great disturbances, beyond the power of our elected officials. The Asian financial collapse of 1997 shows the inherent volatility of the system.

The Response: To prevent future economic meltdowns, we can use the WTO as a forum to persuade nations to adopt international financial standards. With standard auditing we'll be able to avoid speculative bubbles based on faulty projections of economic growth. Investors want transparency too.

The temptation to criticize the WTO is irresistible to politicians who are incapable of governing. Sure, it's scary to realize that forces beyond your control are shaping your nation's economic destiny, but that's the way the world works.

Developing countries can't afford to pay wage rates set by industrialized countries. They must offer low wages or suffer retarded development. Sweatshops got a bad rap in America but at least they gave immigrants a chance of a new life. Imagine how much worse life would be for nations without the economic incentives provided by globalization.

"Globalization causes mass layoffs and huge income disparities. The WTO is rigged in favor of rich countries. We must dismantle it. Mere reforms alone won't alter its mission of capitalism at any cost."

The Argument: If you care not a whit about working folk, globalization is great. Consider these facts: 1.3 billion people survive on under $1 per day according to the 1999 UN Development Report. Eastern Europe has seen the most rapid rise in income disparities ever: between 1980 and 1995, corporate profits rose 145%, and the incomes of CEOs rose almost 500%. During the same period real wages fell. WalMart, General Motors, and Toyota each earn yearly revenues higher than the GDP of most nations.

The Response: It's true that jobs are sometimes lost when inefficient and uncompetitive sectors go out of business. However, on the whole, states that have liberalized their economies create replacement jobs soon enough.

Sampling eighty countries over a forty-year period, World Bank researchers found that all income levels have risen in roughly equal proportion. The early years of a nation's economic development entail big income disparities, but this shrinks over time as wealth gets distributed across society.

The Final Act has special provisions for developing countries. They are specially exempted under umbrella clauses that allow them to justify illiberal trade policies if the "needs of development" require them.

Although it's not the function of the WTO to protect the environment, it doesn't neglect environmental concerns. Article 20 in GATT lets states take actions to preserve human, animal and plant life and conserve natural resources or give subsidies for the purpose of environmental protection.

"The WTO is undemocratic."

The Argument: At the Seattle Summit, the EU, Japan, Canada and the US met in secret closed committees. Other nations weren't invited. This is tantamount to telling them that their interests don't amount to a hill of beans.

The Response: Closed committee meetings may have been a diplomatic mistake, but they're not always a bad idea. It's more efficient to meet in smaller groups and reach consensus before trying to get large groups of states to agree.

The developing countries' lack of experienced and skilled trade negotiators isn't the fault of more developed countries. Outcomes depend on negotiating tactics and styles. There's nothing inherently unfair with the structure of the WTO trading system.

In any event, Third World critics should be careful because their complaints embolden American isolationists, who use any excuse to castigate international organizations. Since the LDCs need the rich nations more than the rich nations need them, they should be more amenable to opening their markets.

"The WTO tramples the dignity and sovereignty of nations."

The Argument: The WTO is an unelected body that governs world commerce. That fact alone should alarm us. Why give a supranational body power over local and national priorities? When local bodies can't protect the environment and public health, democracy is damaged. National development should be in the control of nations, not the WTO. Why shouldn't national self-sufficiency be as prized as global economic integration?

If we must have an international trade organization, let's create one that places human values on a par with corporate values. Link trade benefits with respect for workers. Better yet, why don't we elevate an existing world organization like the International Labor Organization above the WTO?

The Response: We should think twice before conditioning trade on protection of the environment, human rights or labor. This antagonizes other nations and makes them less willing to adopt Western political practices, which should be our goal.

In fact, it was the bullying style of United States Trade Representative Charlene Barshevsky that chafed Third World nations the most at the unsuccessful Seattle WTO Summit. They felt that the developed nations threatened them with trade sanctions for child labor violations in order to block penetration of developed nations' markets by Third World textiles and agriculture.