Mary Kissel: Bureaucrats At the Barricades (book review of "Misadventures of the Most Favored Nations")
[Ms. Kissel is editor of The Wall Street Journal Asia editorial page]
The last time the prospects for free trade looked as bleak as they do now, flapper skirts were in style. The World Trade Organization's Doha Round of global trade talks is so bogged down that it barely rates a mention anymore. In the past nine months, the U.S. has started trade firefights with China and Mexico in the name of "fairness," while Congress sits on free-trade deals with South Korea, Colombia and Panama. Meanwhile countries around the world are experimenting with sneaky forms of protectionism, including "buy local" campaigns, licensing restrictions and "safety" standards so draconian that no competitor can meet them.
Into this grim context comes Paul Blustein with "Misadventures of the Most Favored Nations," his portrait of the WTO and (to quote his book's subtitle) the "clashing egos, inflated ambition and the great shambles of the world trade system." Mr. Blustein, a former Washington Post reporter, argues that the WTO has been crumbling around the edges for years. "It is a dispiriting tale for anyone who believes in the power of globalization to raise living standards around the world," he writes in his introduction, warning the reader to expect "one letdown after another."
Yet there are hints of hope in Mr. Blustein's story, if it is viewed through a wide enough lens. Trade has lifted hundreds of millions of people out of poverty in just the past few decades. The creation of the WTO itself in 1993—an expansion of the 1948 General Agreement on Tariffs and Trade—was, as Mr. Blustein puts it, a "grand bargain" between developed nations "who wanted to modernize international trade rules" and developing nations "who wanted new and more advantageous rules in areas of trade that they cared about," like agriculture and manufacturing. Negotiators even had to compromise on the organization's name. One Clintonite joked that, given its far-reaching dreams, it should be dubbed "the Cosmic Trade Organization."...
... The victims who suffer most in trade conflicts are the people whose concerns go largely unaddressed in Mr. Blustein's chronicle: the average consumer, who is of course also a worker. As countries throw up barriers to trade, consumers pay higher prices for imported goods. Export-oriented businesses suffer. Job-creating foreign investment is discouraged. And the global trading system that moves capital and goods efficiently from one country to another runs the risk of entering a downward spiral, as it did in the 1930s.
Remarkably, you would never know that the global trading system is now full of nastiness—trade wars, stalled talks, rising protectionism—if you listened to most national leaders. President Barack Obama told the United Nations last month that "we will integrate more economies into a system of global trade." Mr. Blustein buys into this empty rhetoric, claiming that Mr. Obama is "not antitrade." Tell that to Mexican truckers and Chinese tire-factory workers—and U.S. consumers—who once enjoyed the fruits of freer trade than we have today.
Read entire article at WSJ
The last time the prospects for free trade looked as bleak as they do now, flapper skirts were in style. The World Trade Organization's Doha Round of global trade talks is so bogged down that it barely rates a mention anymore. In the past nine months, the U.S. has started trade firefights with China and Mexico in the name of "fairness," while Congress sits on free-trade deals with South Korea, Colombia and Panama. Meanwhile countries around the world are experimenting with sneaky forms of protectionism, including "buy local" campaigns, licensing restrictions and "safety" standards so draconian that no competitor can meet them.
Into this grim context comes Paul Blustein with "Misadventures of the Most Favored Nations," his portrait of the WTO and (to quote his book's subtitle) the "clashing egos, inflated ambition and the great shambles of the world trade system." Mr. Blustein, a former Washington Post reporter, argues that the WTO has been crumbling around the edges for years. "It is a dispiriting tale for anyone who believes in the power of globalization to raise living standards around the world," he writes in his introduction, warning the reader to expect "one letdown after another."
Yet there are hints of hope in Mr. Blustein's story, if it is viewed through a wide enough lens. Trade has lifted hundreds of millions of people out of poverty in just the past few decades. The creation of the WTO itself in 1993—an expansion of the 1948 General Agreement on Tariffs and Trade—was, as Mr. Blustein puts it, a "grand bargain" between developed nations "who wanted to modernize international trade rules" and developing nations "who wanted new and more advantageous rules in areas of trade that they cared about," like agriculture and manufacturing. Negotiators even had to compromise on the organization's name. One Clintonite joked that, given its far-reaching dreams, it should be dubbed "the Cosmic Trade Organization."...
... The victims who suffer most in trade conflicts are the people whose concerns go largely unaddressed in Mr. Blustein's chronicle: the average consumer, who is of course also a worker. As countries throw up barriers to trade, consumers pay higher prices for imported goods. Export-oriented businesses suffer. Job-creating foreign investment is discouraged. And the global trading system that moves capital and goods efficiently from one country to another runs the risk of entering a downward spiral, as it did in the 1930s.
Remarkably, you would never know that the global trading system is now full of nastiness—trade wars, stalled talks, rising protectionism—if you listened to most national leaders. President Barack Obama told the United Nations last month that "we will integrate more economies into a system of global trade." Mr. Blustein buys into this empty rhetoric, claiming that Mr. Obama is "not antitrade." Tell that to Mexican truckers and Chinese tire-factory workers—and U.S. consumers—who once enjoyed the fruits of freer trade than we have today.