Reality Check

By Sutherland, Peter D. | Harvard International Review, Spring 2000 | Go to article overview

Reality Check


Sutherland, Peter D., Harvard International Review


Abstract:

The Seattle Ministerial Conference of the World Trade Organization demonstrated with disturbing force the huge confusions that haunt the public mind and much of global politics about the nature of trade and the process now known as globalization. The notion that globalization is an international conspiracy on the part of the industrial-country governments and large firms to marginalize the poorest nations to exploit low wages and social costs wherever they may be found, to diminish cultures in the interests of an Anglo-Saxon model of lifestyle and language, and even to undermine human rights and cut away democratic processes that stand in the way of ever more open markets is, of course, utter nonsense. Yet the Seattle demonstrations vividly exhibited the worrying tendency to equate these concerns and others to the existence and potential development of the World Trade Organization, the international and legal face of the world trade system. If left unquestioned and unchallenged in the interests of political correctness or political advantage, this sentiment could set the cause of economic and social development back 20 years.

Text:

The WFO and Globalization After Seattle

The Seattle Ministerial Conference of the World Trade Organization (WTO) demonstrated with disturbing force the huge confusions that haunt the public mind and much of global politics about the nature of trade and the process now known as globalization. The notion that globalization is an international conspiracy on the part of industrial-country governments and large firms to marginalize the poorest nations, to exploit low wages and social costs wherever they may be found, to diminish cultures in the interests of an Anglo-Saxon model of lifestyle and language, and even to undermine human rights and cut away democratic processes that stand in the way of ever more open markets is, Of course, utter nonsense. Yet the Seattle demonstrations vividly exhibited the worrying tendency to equate these concerns and others to the existence and potential development of the World Trade Organization, the institutional and legal face of the world trade system.

This outpouring of misconceived, ill-understood propaganda against a system that has brought vast gains to most nations over the past few decades is extraordinarily dangerous. It is a threat to the prospects of a better life for many millions, perhaps billions, of people at the start of the new millennium. If left unquestioned and unchallenged in the interests of political correctness or political advantage, this sentiment could set the cause of economic and social development back 20 years. This threat is made all the more serious by the difficult new challenges facing governments today. Still, Seattle showed more clearly some of the institutional difficulties of managing effective decision-making processes, with over 100 countries truly interested and involved in managing the geopolitical realities of the 21st century.

The Biggest Straw Man

In order to understand the dangers implied by attacks on the INTO, one must first distinguish between "globalization" and the World Trade Organization. Neither as a body of international law nor as a governmental institution can the INTO be regarded as synonymous as globalization. The WTO, like its predecessor the General Agreement on Tariffs and Trade (GATT), is a collection of rules and undertakings voluntarily entered into and implemented by governments on the basis of consensus among those governments to provide a predictable, stable, and secure environment in which all types of firms can trade and invest. A small transfer of national sovereignty (insofar as any purely intergovernmental structure can affect sovereignty) in the interest of internationally enforceable disciplines brings economic gains for all and prevents economic muscle from being the sole arbiter of commercial advantage. It is easy to argue that in a period when business is as likely to be conducted at the global level as at the national, the WTO recovers a degree of sovereignty for governments that otherwise find themselves no longer able to influence significant aspects of their economic future. …

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