World Trade Organization bad for our world
President Clinton immediately hailed as a good agreement for China, for America and for the world the Nov. 15 accord that opens the way for China to join the World Trade Organization, commonly known as the WTO.
It is a judgment far from universally shared. Workers, both in the United States and in China, will suffer from the unrestrained competition that is the primary objective of the WTO, because the organization has no rules for their benefit. Workers on both sides of our long border with Mexico already know who benefits from and who is hurt by the WTO rules. The expansion of trade following the North American Free Trade Agreement, which incorporates the WTO principle of unrestricted movement of goods, has significantly lowered their real wages.
The World Trade Organization has been in existence for only five years, but the harm it has already done is so outrageous as to bring the representatives of a thousand non-governmental organizations -- called NGOs -- to Seattle last week to protest at its third ministerial meeting.
It has taken only five years for the WTO and its promotion of globalization to upend the role of nation states. So much of what once was the states role and responsibility in major decisions affecting health and welfare has been turned over to the chief players in the global marketplace.
So the protesters came to Seattle with a list of charges that in the past would have been laid at the doorstep of national governments.
The protesters charged that the WTOs three-judge courts -- whose proceedings are kept secret -- have found for the plaintiffs in every case brought before them that challenges environmental or public safety legislation. The giant sea turtles lost their protection under the Endangered Species Act when foreign commercial shrimpers protested. Venezuelan oil companies succeeded in quashing the U.S. Environmental Protection Agencys air quality standards for imported gasoline. The European Unions ban on hormone-treated beef was overturned by U.S. cattlemen.
Many countries fear that the WTO will be used to destroy their cultures. Last year some 20 nations, including Brazil, Italy, Ivory Coast, Mexico and Sweden, met in Ottawa to discuss ways to protect their film production industries and other expressions of their culture from the Hollywood juggernaut. Shortly afterward, a similar gathering in Stockholm under U.N. auspices recommended that culture be granted special exemptions in global trade deals.
While claiming to be all for free trade, the WTO is in fact protectionist. It has no time for free markets in intellectual property rights, the patents, copyrights and monopolies that benefit principally major corporations. Pharmaceutical corporations, for example, use patents protected by the WTO to charge consumers in the United States twice what the same drugs cost the consumer in countries in which the government fixes the fair price of the same drugs.
The pharmaceutical companies defend the higher prices here as necessary to finance continuing research and development. An arrangement brokered just weeks ago by the World Health Organization -- called WHO -- to develop antidotes for malaria exposes the fallacy of this argument. Malaria each year strikes 300 million to 500 million people. A million die, and the others lose much of their ability to earn their living. The situation gets worse each year because strains of malaria grow more resistant to established treatments.
A vast need, however, does not automatically make a market. Most victims of malaria live in Africa. Most of them are wretchedly poor. No drug company is interested in investing $500 million, the estimated average cost of developing and registering a pharmaceutical product, when the people who need the drug cannot afford to pay for it. In this situation, WHO has created the Medicines for Malaria Venture with funding from the World Bank, the Rockefeller Foundation, the Global Forum for Health Research, Swiss and British government agencies, and the International Federation of Pharmaceutical Manufacturers Associations. It plans to develop and register a new antimalaria drug every five years.
The WHO intervention provides a more rational formula for the unending research and development needed to ensure the new drugs needed to protect the health of the worlds peoples. It is a formula based on need, not greed. Public funding of all drug research and development would give us the drugs we need at less cost.
The dominant issue for the NGOs at Seattle, however, is whether the meeting will provide trade sanctions against countries that violate internationally agreed standards, like the ban on forced labor and child labor. AFL-CIO president John J. Sweeney has criticized the agreement with China for failing to include commitments to allow free trade unions and to free imprisoned labor leaders. He insists that the Seattle meeting must provide worldwide guarantees for organizing trade unions and engaging in collective bargaining.
The Clinton administration has made some noises indicating sympathy with the demands of labor. But the focus of its concern for the Seattle meeting seems to be elsewhere, namely, a Global Free Logging Agreement. This, if approved, will lead to unsustainable logging worldwide and adversely affect the protection of the limited forest cover that we still have here in the United States. Nobody knows what will be the effect on the planets climate. What is certain is that it will not improve it.
National Catholic Reporter, December 10, 1999