WTO In A Bind

    The nervousness among the proponents of so-called "free trade" continues as the World Trade Organization (WTO) meets in Hong Kong. The New York Times reports that the negotiators have given up on making progress on "intractable issues like farm subsidies" so they are going to "focus heavily on increasing exports from the world's poorest countries."

    That made me shake my head. You might remember that at the turn of 2005, a worldwide agreement on apparel expired--it was called the Multi Fiber Agreement--which was designed precisely to help poorer countries try to compete in the global markets.

    Back then I wrote (you can read the full article "Of Trade, Quotas and Fairness"): "After 40 years, the New Year will mark the end of worldwide quotas on apparel, courtesy of the World Trade Organization. Quotas—far from being a bad thing—are a way to manage some fairness or equilibrium in trade relations. In contrast to the Wild West, cutthroat-system of so-called "free-trade," for which the WTO acts as ideological enforcer. Within 500 days, 70 percent of the industry will move to China —a $220 billion shift; $42 billion of that shift will happen just in the business other countries had with the U.S."

    And pointed out that this was going to particularly hit the poorer countries hardest.

    Meanwhile, I meant to report that a week ago, there was a media report (NYTimes) that a former Assemblyman Roger Green was considering taking on Ed Towns, one of the CAFTA 15. A serious candidate would get a lot of help from labor.

Comments

[la]

Can someone explain to me why export growth is better than internal growth(especially for large countries?) I don't get it.

I would like to think that the WTO is on it's last legs, but these guys are pretty good at what they do and I think it may be a long time yet before we see some real progress.

[Tasini]

Export growth isn't inherently better than producing internally. In fact, people warned for years that the export model was a risky proposition for developing countries.

And I agree that you can't assume the WTO is crumbling. But, thanks to a lot of work done by various folks, the so-called "free trade" agenda is a bit off the tracks.