Tracking World Trade

Tracking World Trade

Political scientist Deese takes the long view in assessing global market

By Sean Smith
Chronicle Editor

It may prove one of the most important achievements of the Bush Administration, but the president's signing of the Trade Promotion Authority Act late last month went virtually unnoticed amidst coverage of the Iraq debate, the John Allen Muhammad case and triumphant rally monkeys.


David Deese
(Photo by Gary Gilbert)
The TPA means that, for the first time in eight years, the president can directly negotiate foreign trade agreements for the United States. Congress had allowed the earlier delegation of presidential authority to expire in 1994 during its dispute with President Clinton, and in the interim had to grant approval before US representatives could initiate talks, a process that experts like Assoc. Prof. David Deese (Political Science) called unwieldy and an obstacle to the country's role in the international marketplace.

"It's a little like dating," said Deese in a recent interview. "Another country is simply not going to get serious with us on trade if it doesn't think we're serious. And for them to think we're serious, they have to know the president has the authority to negotiate.

"The fact that Bush now has this authority, and that it came through a bipartisan effort, is a major development that shouldn't be ignored."

Deese says he is not surprised when such events spark relatively little attention among Americans. The subject of world trade and economic globalization is complex, and might seem to require both an academic and professional grounding just to hold a meaningful discussion. Media coverage of international economic conferences, and the protests accompanying them, do not necessarily broaden public understanding of world trade, he said.
But, Deese adds, even those who are knowledgeable on the issues - public policy makers, analysts, activists - lack a balanced, historical, in-depth and accessible account of how the global trade system has grown to be so broad in its reach and effects. Deese aims to remedy that through the forthcoming publication of his newest book, tentatively titled Leading Economic Globalization.

The book is an outgrowth of Deese's research on the World Trade Organization, and how, despite modest resources and a decentralized approach, it has evolved over five decades into the most influential and authoritative of all global intergovernmental organizations.

"The International Monetary Fund and the World Bank, which tend to get most attention among international trade and development organizations, have taken plenty of hits in the past year for their shortcomings, especially the World Bank," said Deese. "The WTO's total budget is only a little more than the World Bank's travel budget. But the WTO has 145 member states and dozens more in line to join, and it's provided the foundation for a truly global regime of rules, norms and procedures governing trade."

Deese says the WTO deserves credit for establishing a process of bargained agreements to sharply reduce the tariffs and other barriers to trade in manufactured products, beginning with agreements from 1947 among about two dozen member states. The organization has gradually broadened the scope of areas covered by the negotiations to include food and agricultural products, as well as services.

The WTO's new Dispute Settlement Body is unprecedented in its authority and enforcement capabilities, other than the European Union's institutions, Deese adds, in that member states have obliged themselves to participate in diplomatic negotiations to resolve trade disputes, and ultimately to abide by the findings of a highly legalized set of WTO dispute settlement bodies.

"Of course, the degree of the WTO's success also depends on the eye of the beholder," said Deese. "Precisely because of its expansion into almost every area of trade and type of 'barrier' to trade, as well as its mandatory dispute settlement powers, the WTO is controversial, indeed a prime target of anti-globalization protestors.

"As almost every sector of member states' economies is affected by trade, and as members seek to prevent each other's domestic regulations and procedures from being used to restrict or gain advantage in trade relations, trade liberalization is seen as a 'barrier' to governments' domestic policy autonomy, and it can clash with legitimate environmental and other domestic standards and legislation."

Deese, who spoke with a number of key political and economic experts on world trade issues, traces the origins and development of the WTO from its post-war beginnings as the General Agreement on Tariffs. The centerpiece of the book is a series of case studies detailing instances of failure and success in GATT-WTO history: from the fall of the International Trade Organization and overlapping creation of GATT to the unproductive Seattle meetings in 1999 and the subsequent agreement on development issues in the current WTO session, or Doha Round.

"The results of the paired sets produce not only trends and patterns over the 50-year period, but also policy implications based on the conditions most applicable to the current and near-future period," said Deese.

Bush's newly restored authority as trade negotiator through the TPA act shows how vital Congress regards a US leadership role in the Doha Round. Deese says, Multilateral negotiations such as the WTO are less politically controversial in the US, and less difficult for members of the House and Senate to vote for, he explains. Democrats in particular are more likely to oppose bilateral or regional agreements like NAFTA or the Free Trade Area of the Americas initiative because these tend to have a more visible impact on constituents and US businesses.

"Democrats who supported the TPA generally made their support conditional on the inclusion of adjustment assistance for workers affected by any trade liberalization," he said.

 

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