"Developing nations stand absurdly
accused, by new and old protectionists alike, of taking advantage
of the doubtful benefit of being poor."--Luiz Lampreia,
Brazilian Minister of Foreign Relations, December 1999
Seattle ministerial meeting of the World Trade Organization (WTO)
ended late December 5 with nothing more to show for its efforts
than several million dollars worth of broken glass and looted
shops, courtesy of protesters. Representatives from the 135 member
countries failed to reach consensus despite long hours of meetings,
even regarding issues such as agriculture and services that
delegates had long determined would comprise part of the agenda for
a new trade round.
President Bill Clinton, the host of the
meeting, ruined any chance of an agreement even before he arrived
in Seattle. In a November 30 telephone interview with the
Seattle Post-Intelligencer, he reiterated his desire to
formulate labor standards and incorporate them into all future WTO
agreements. "[U]ltimately," he added, "I would favor a system in
which sanctions would come for violating any provision of a trade
Other member nations immediately
recognized the dangers of such a proposal, and the Seattle meeting
ended without any accord on the issue of tying labor to trade
agreements--not even the preliminary step of forming a working
group to discuss it. This was fortunate because the President's
proposal is highly damaging, not only to U.S. leadership and
credibility, but also to the future of the people in developing
nations that the Administration wishes to assist.
Damaging to the U.S.
The Clinton Administration has urged other nations to liberalize
their trade regulations, but the President's vision of the future
of international trade evoked an image of a far different world and
indicated to other nations that the Administration could change its
agenda over the narrowest of political interests.
Worse, the President's statement played to
international fears of American hegemony. It reinforced the
deteriorating international opinion of America and its global
leadership role. Other nations saw a United States that would host
a discussion of free trade but not commit itself to it, and that
even recommended the use of sanctions, a barrier to free trade. In
the long run, the greatest damage from the President's rash
proposal is likely to be the erosion of international support for
U.S. leadership on trade issues.
catering to factional U.S. political interests, the President sold
out long-term American interests and sacrificed the cooperation of
other nations in the multilateral sphere. This failure has domestic
repercussions for the Administration as well: By undercutting its
professed commitment to free trade, the President has undermined
his chances of securing congressional approval for his hard-won
agreement with China.
Damaging to the WTO.
In negotiating trade agreements at the WTO, delegates must balance
the dual aims of achieving consensus and meeting the goal for which
the organization was created: trade liberalization. Adding social
regulations to the already difficult process of lowering trade
barriers creates the danger that a forum for multilateral
deregulation will become instead a regulator of nations.
President's statement snapped the tenuous thread of consensus
building. By the time the President arrived in Seattle, no
developing nation was willing to cooperate with U.S. proposals
because of the threat to their sovereignty and to their future
implicit in his statement. Therefore, no agreement emerged from a
meeting already fraught with pitfalls. Now trade ministers from
many countries predict that the WTO likely will fail to reach any
agreement on the composition of a new trade round until after the
U.S. presidential elections in November 2000--a year of economic
development lost due to lack of leadership.
Damaging to economic
Beyond the Seattle meeting itself, or even the launch of a new
trade round, the statement was harmful to the process of trade
liberalization worldwide, and ultimately to global economic
development. What nation's leader can argue to domestic political
critics that they must open their market if the world's largest
trading nation does not advocate free trade? The United States, and
the world, needs forthright leadership that will push unequivocally
for free trade. The President must explain to the American people
that free trade is essential to domestic prosperity and
international economic development, and that America is committed
to taking action to achieve this aim.
Damaging to developing
The best way to help poor people in any nation is to offer them
open access to markets. The best way to harm their development is
to impose standards that they cannot possibly meet. Under the
President's proposal, developing nations would be twice punished
for the crime of being poor: first, by being unable to adhere to
the same standard of living that developed nations enjoy, and
second, by being sanctioned for such failure. By stultifying
economic development, this plan would kill any hope of economic
growth. Ultimately, the President's proposal would impair efforts
to establish the very labor standards it meant to implement.
Linking labor standards to trade
agreements will advance neither trade nor labor interests. The
surest route to improved labor standards is through free trade,
which leads to economic development and thence to the means to
create and sustain a more prosperous way of life.
The Administration frequently expresses a laudable desire to
assist people in developing nations. However, the President's
proposal is a formula for destroying any hope of development in
these countries, impoverishing them before they even have a chance
to experience real prosperity.
Trade liberalization is the surest way to
boost labor standards worldwide. To impose international labor
standards and then to punish those who cannot hope to abide by them
is the surest way to consign the poor to perpetual poverty. The
Administration and Congress need to advance a free trade agenda to
foster global economic development and defend America's own
Denise H. Froning is a former Policy
Analyst in the Center for International Trade and Economics at The