The mask slips

The Third World blocks US plans at the WTO's Seattle round.

American organizers for the Third Ministerial Conference of the World Trade Organization faced a multitude of problems, not least among them: How are we going to get anything meaningful done in a city full of protesters from all over the world? Now that the show's up and running, it's clear their biggest challenge is one they didn't prep for: How are we going to cover our asses and pretend that WTO Seattle 1999 isn't turning out to be a catastrophic public embarrassment for US foreign and economic policy?

For many of the WTO's 130-plus member states, close friends of the US among them, a healthy dose of humiliation's just what the superpower-to-end-superpowers needs just now. And for some, the more developed nations of the Third World among them, the failure of the US to force a further round of "liberalization" in international investment, biotechnology, and copyright policies on the foreign ministers meeting in Seattle is a big win: just what they've been fighting for with increasing determination ever since the WTO was born in 1994.

According to the organization's own rule book, the Council of Ministers now meeting in Seattle is "the WTO's top level decision-making body." But three or four days every couple of years is not enough time to develop coherent and mutually acceptable policies for a field as insanely complex and politicized as international trade. For that the Council depends on its Geneva-based General Council ("normally ambassadors and heads of delegation in Geneva"), which does the scut work of hammering out an agenda for their bosses to ratify at the next "Ministerial."

In his letter to the Downtown Association about the Ministerial's impacts on the city, Mayor Paul Schell calls the WTO "a United Nations type organization." Well, no, Paul, that's not quite right. The UN was set up in the good old days when being a superpower meant something. The WTO doesn't afford its members status according to their bank account. At the WTO all members are equal. "Decisions are made by the entire membership," says the rule book, "typically by consensus. A majority vote is also possible but it has never been used in the WTO."

Consensus, of course, can be manufactured: by bullying, blandishment, and bribery as well as sweet persuasion. The great trading powers deployed all four to bring the WTO into existence in the first place and to secure agreement for their agenda of further lowering of trade barriers at the first two "ministerials" thereafter, at Singapore in 1996 and Geneva in 1998.

By all indications, US trade reps in Geneva expected the same recipe to work in the run-up to Seattle, where great things were expected for US industries such as software, entertainment, wireless telephony, biotech. They overlooked a couple of new factors in the equation. When the "Uruguay Round" of trade liberalizations took effect in 1994, Third World members of the WTO had been told to expect to see great econo- mic progress. By 1998, any progress made had been more than offset by the devastating Asian economic collapse of 1997, and the only country registering progress seemed to be the US.

So when US trade reps started lobbying in Geneva for yet another round of cutbacks in tariffs, export subsidies, currency controls, and the like, their fellow delegates started asking, at first politely, then ever more insistently, for a explanation of just how such changes would benefit their own countries. Apart from generalities about the overall beneficent impact of free trade, they never got one. So, one by one, then in informal groups drawn together by common interest in one or another trade issue, an opposition began to form. It was not an opposition to free trade per se—after all, the objectors were themselves trade specialists—but an objection to any further tinkering with the existing rules of trade until members could cope with the consequences of changes made already and, in some cases, even get the rules changed back again.

The objectors also were angry that so far as the developed countries were concerned, "free trade" appeared to be a one-way street. If a pharmaceutical company discovered a new antibiotic in the Indonesian jungle, took it home, patented it, and shipped it back to Indonesia at a thousand-percent markup, that was protected free trade. If a Third World country exported textiles or steel at a price which undercut that of the same product manufactured in a developed country, that was called destructive "dumping" and could be banned.

Still, bully-bribe-and-blandish might have saved the day again if the economic superpowers, the US and the European Union (which between them account for more than half the world's production and trade), had been able to maintain a united front. But the United States is determined to sell genetically modified foods in Europe, no matter how violently Europeans object to having genetically modified foods sold to them. With the big kids on the block at each others' throats, the smaller kids found time to make common cause against them.

Accustomed to getting its own way in international organizations like the World Bank and the International Monetary Fund where the paramount rule is one-dollar-one-vote, the US plowed ahead without compromise on its own agenda in Geneva. It bulldozed its way against 90 percent or more of the WTO membership to put in its own candidate as WTO director general.

But by the time Mike Moore of New Zealand had been confirmed in the post this spring, wheeling-dealing time was short. Toward the end of his term, Moore's predecessor as director general, Renato Ruggiero, renounced the closed-door "green room" sessions at which consensus had been engineered for the Singapore and Geneva Ministerials. Moore promptly revived the practice of bringing small groups of representatives together for a little secret dickering and arm-twisting, but this time the only result was to publicize the divisions between interest groups and encourage opponents of any new trade agenda for Seattle to drag their feet. A week ago the General Council threw up its hands in total frustration. When the trade ministers of 137 nations came together in Seattle, they would be on their own, with no pre-set agenda to cling to.

As the real possibility of chaos inside the high-security meeting room as well as in the streets outside finally penetrated the US trade delegation and the White House, Bill Clinton made a last ditch effort to at least save appearances, privately trying to persuade presidents and prime ministers of some of the most powerful WTO member nations to come to Seattle and whip their troops into shape. He got a polite refusal from every single one of them.

Apart from philosophical anarchists, most people think of chaos as destructive and therefore dangerous. But in this case it has its positive, constructive side. Ever since David Ricardo proved back in the early 19th century that unfettered trade between nations will always generate greater total output than trade restricted in any way whatever, both thoughtful economists and humanitarians have tried to point out that maximum total output is a hell of a crude measure of total human well-being.

The WTO rebels inside and outside the Convention Center agree. For perhaps the first time ever, they are making themselves not only heard but felt where it counts: on the same international stage their rich, smug, calculating opponents have dominated until now. Money and power may still ultimately win the day—when have they failed to in the past—but if they do, it will not be wearing the mask of consensus.

 
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