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December 09, 2007



Many liberal neo-liberals have been arguing for more embedded Keynsian social democracy (welfare state in the negative formulation used by the author)as the appropriate response to our current trade regimes. This author is saying that we cannot "return" to that social compromise.

It seems to me that western Europe has been relatively successful in managing the negative effects of WTO policies precisely by using traditional social democractic policies.

I appreciate the comment about the "non trade concerns" leading to crude protectionism. Its not as if our current trade regimes do not intrude upon non trade concerns and set up the need for democratic self-protection.


Dani -
Thanks for returning to the original discourse on Gatt and its historical tradition which, I might add, was strengthend by binding arbitration procedure introduced under WTO.

However, if you recall my earlier inputs in this debate, I was confounded by the introduction of so-called non-trade authority which was part and parcel of what became known as "globalization" under Clinton/Rubin.

The EU Council (last week) decided that after legal adoption of the (revised) EU Treaty, this weekend in Portugal, they'll make an official declaration on their collective next step: namely, to tackle the issues related to globalization!

I'd like to see you take up their official declaration under your blog and see what kind of reaction is forthcoming.


"Adjustment, the management of an internal economic crisis in a manner that would be politically and socially sustainable domestically, but also not threatening to the integrity of the international legal order, was facilitated as well by the other Bretton Woods institutions, the International Monetary Fund (IMF) and the World Bank. A global financial order based upon managed or supervised exchange rates and exchange rate adjustments, and emergency liquidity assistance from the IMF, would provide means of working out macroeconomic instability that would neither threaten liberal trade, nor on the other hand lead to beggar-thy-neighbor macropolicies or currency devaluations." --Robert Howse

So what amounts to wisdom here is helping to legitimize the WTO by having it bring in the outsiders. However, what the outsiders want to bring to the table isn't necessarily trade specific. They want to place environmental rights, labor rights , human rights, and other value issues on the table. Isn't the task of returning to the spirit of Bretton Woods through the use of the lawyer as poet to finesse such issues made all that more difficult after the social consensus of the New Deal has been broken by the Reagan revolution at home, and abroad American power is waning.

Today's differences are that much harder to reconcile no matter how much poetry lawyers may have in their souls--especially when the members of the WTO fear standards as deal breakers on trade issues, and outsiders brought to the table still see the WTO as an organization without either law making ability or enforcement capabilities.

Not only is it an organization run by a judiciary. The legitimacy of its pronouncements are not only made weaker by the breakdown of the social consensus that may have existed after WWII but also by an ever growing body of people who don't support free trade as practiced today.

Surely, finessing this situation through the law as poetry is weak tea. Lawyers finding ways to bring outsiders into the WTO does help improve the problem of WTO legitimacy, but it remains an organization ill suited to handle value questions.

Unless one can make the argument that WTO practices have little effect on the economic morality of nations, wouldn't it be better to scrap the WTO and start over with international governmental bodies like the EU which are better suited to resolve both value and trade questions than to maintain the WTO whose trade regime acts to undermine not only values but legitimacy. For instance actions that made sense within the EU are made non sense by actions within the WTO. Why, for instance, support the right of labor to free association and then allow businesses to hollow out that right with WTO allowances.

Better a bevy of interlocking international organizations with governmental powers than one WTO.

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For instance actions that made sense within the EU are made non sense by actions within the WTO. Why, for instance, support the right of labor to free association and then allow businesses to hollow out that right with WTO allowances.

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