While the WTO Burns

Review and Outlook
Copyright 1999 Wall Street Journal
December 2, 1999

As the melee in Seattle was televised around the world, we were especially touched by the Knight-Ridder account of a teary 21-year-old bank teller denouncing vandals who broke the bank's windows in the name of opposition to the World Trade Organization. "This is my job!" she cried, "This is how I eat!"

If the rioters get their way, her fate will be shared by millions of even less fortunate people around the world. So she is a powerful metaphor for what happens when business and politicians allow trade to become hostage to special interests. Indeed, it might be worth having Hank Greenberg, head of American International Group, John Pepper, chairman of Procter & Gamble, and Robert Shapiro, at the top at Monsanto Co., sit down with her for a chat. Their signatures on a letter supporting the Clinton Administration's proposal for special labor and environmental working groups at the WTO, union leaders' price for allowing the meeting to go forward, did a great deal to bring the throng of activists to Seattle in the first place.

We would hope that they and other business leaders now have some second thoughts about the notion that these issues can be solved by honest dialogue. To begin with, we might stop referring to those who took to the streets on Tuesday as "protesters"; it's far too generous a term. Plainly the Seattle activists are being used as shock troops by special interests trying to protect their own privileges at the expense of workers in the rest of the world.

In Washington and other national capitals, of course, special interests are part of the landscape, hiring lobbyists to make their points with lawmakers. In recent years, however, and especially with the discrediting of socialism, the interests of the many who gain from freer trade have begun to tell against the interests of the globe's hitherto protected interests. Having failed to secure their narrow agenda through the democratic process, these activists have radicalized.

In a more sensible world, the Seattle fiasco would be understood as a last-ditch ploy by washed-up protectionists to save their own endangered skin. Alas, what we find instead is that the labor and environmental groups that descended on Seattle with their rocks and their fists are now legitimized, nay, energized by U.S. corporate and political leaders who either don't understand what these groups are about or are afraid to stand up to them.

At the head of this list has to be President Clinton, who virtually invited them to come to Seattle. Before the Tuesday riots, Mr. Clinton told reporters in Washington that "we should strengthen the role and the interest of labor and environment in our negotiations." He also said, "We should open the process up to all those people who are now demonstrating outside. They ought to be a part of it." For millions of Americans who thought they were living in a representative democracy, the concept of special recognition, won by militant protests, will undoubtedly be shocking.

In contrast to the White House's raw political ambition for November 2000, Corporate America may have believed that by signing on to the labor and environmental working groups, it was diffusing the "mobilization against globalization." Frank Coleman, spokesman for the U.S. Chambers of Commerce, said that the fact that John Sweeney, head of the AFL-CIO, signed the now-infamous letter meant that labor would support the "trade agenda."

If that was the strategy, clearly it's time to go to Plan B. The very existence of "working groups" on these issues gives the anti-trade movement a foot in the door and a chance to commandeer the free-trade train. The one benefit of the WTO's predecessor, the General Agreement on Tariffs and Trade, was that the GATT was not an organization, but a negotiation. Once the decision was made to create the WTO and give it a secretariat, it was on its way toward becoming a mini-United Nations.

Once established, any labor-environment working groups will be impossible to get rid of. Soon they will be determining everything from minimum wage rates to environmental standards that would preclude all sorts of development -- with big business going along (a la IMF bailouts) to get its niche trade favors. Already the Third World has begun to express its concerns, as well it should. It's hard to see why countries trying desperately to bring prosperity to their peoples should sign on to a deal giving politicians from rich countries the right to dictate Third World domestic policies in order to appease First World special interests and dilettantes.

With trade widely recognized as the main engine for economic development, the temptation to practice guerrilla tactics, holding trade and commerce hostage, in exchange for all kinds of special privileges will only grow. No self-respecting NGO is going to deal with the United Nations anymore when it can go where the money is. As the hoopla in Seattle shows, the WTO will fast become the institution of choice for every activist agenda on the globe.

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