November 99

Views expressed are those of the authors, not necessarily of the AFSC.

The WTO and Free Trade

Peter Montague is editor of Rachel's Environment and Health Weekly.This article is an abridge version of #673, Oct. 21, 1999. (REHW, Environmental Research Foundation, PO Box 5036, Annapolis, MD 21403; Fax 410/263-8944; erf@rachel.org To start your own free subscription, send Email to listserv@rachel.org with the words SUBSCRIBE RACHEL-WEEKLY YOUR NAME in the message.) For good background on the WTO and other international trade agreements, see the Oct. Peacework or read the full version of this article online.

"The Protest of the Century" will take place in Seattle, WA, Nov. 29 to Dec. 3, amid teach-ins, workshops, and strategy sessions all aiming to send a powerful message to the World Trade Organization (WTO), who will be there for the Third Ministerial Meeting. Activists are calling for people from all nations and all walks of life to make the journey to Seattle, to demand that the WTO change its ways.

Far back in the mists of time, when humans began trading shells and beads with each other, the first markets emerged, but such traditional markets were never free. All traditional markets are embedded in societies and are regulated and restrained by those societies for the purpose of maintaining social cohesion. Familiar societal controls on markets include:

• the Roman Catholic and Islamic religions' prohibitions against usury;
• medieval guilds, which set minimum wages, and which set standards and prices for goods;
• customary prohibitions or restrictions on the sale of certain goods, such as public spaces, sexual favors, spoiled food, and judicial decisions;
• laws requiring government purchasing policies to give preference to businesses run by people of a particular city or region, or by women or minorities, or by some other identifiable group;
• regulations requiring that products be labeled with their ingredients or with their method of production (such as "organically grown"), and that the labels be certifiably true;
• laws discouraging monopolies, to promote competition;
• a guaranteed minimum income, regardless of employment, traceable to 1795 in England;
• laws requiring that production methods should protect endangered species;
• prohibitions against child labor;
• government ownership of certain public-service enterprises (state hospitals in the US, or the oil industry in Mexico);
• limits on the length of a work day;
• restrictions on 100% ownership of businesses by foreign nationals;
• tariffs intended to increase the price of imported goods as a way of protecting domestic producers;
• government subsidies to promote particular industries--for example, planting many thousands of seedlings to assure a domestic timber industry in the future;
• Etc., etc.

It is not possible to generalize that all controls on markets are good or bad. Governments impose market restrictions as part of their primary duty, which is to provide security for the citizenry. Markets that are free of restrictions, regulations, and encumbrances do not occur spontaneously. They only appear when they are engineered by the relentless application of state power. They are extremely rare.

For a very brief period, and in one country only, a free market, or laissez faire regime did emerge--in the latter half of the 19th century in England, imposed by the brute power of the state, at great cost to the average citizen. Charles Dickens wrote novels about life during this period. The British "free market" experiment collapsed into the trenches of World War I and was not heard from again until the ruling (business) class revived the idea in the late 1970s in Great Britain, the US, Australia, and New Zealand. Thus, actual experience with free market regimes is quite limited; they are difficult to establish and maintain in the face of popular opposition. In a vigorous democracy, free markets soon revert to regulated markets because citizens demand security, equity, and humane treatment. They are efficient (in the narrowest economic meaning of that word) but the historical record demonstrates that they are painful and costly for working people, incompatible with democratic institutions, and destructive of the natural environment. History shows that, left unregulated, markets cannot take into account that species are disappearing at unprecedented rates, economic inequalities are growing ominously, and the lives of families and communities are in tatters.

Now transnational corporations--working through the governments that they dominate--have spent roughly 20 years exporting the "free market" model --a utopian experiment in social engineering that takes your breath away for its scope, scale, and boldness. Even the most ruthless social engineers of the 20th century--Josef Stalin and Mao Zedong--did not attempt social engineering projects on this scale. The WTO is the vehicle for enforcing this colossal attempt to remake all of the world's economies according to a single utopian idea.

The WTO allows countries to challenge each other's laws and regulations. Cases are heard and decided by a tribunal of three trade bureaucrats, usually corporate lawyers. There are no rules on conflict of interest, nor any requirement that the judges have any appreciation of the domestic laws of the countries involved. The judges meet in secret. Documents, hearings, and briefs are confidential. Only national governments are allowed to participate, even if a state law is being challenged. There are no appeals to anyone outside the WTO. Once a WTO ruling has been issued, losing countries can (1) amend their laws to comply with WTO rules; (2) pay annual compensation to the winning country; or (3) face non-negotiated trade sanctions.

In Seattle, corporations intend to expand the WTO's power and reach even further. Activists are demanding that the WTO be opened up to scrutiny and that its record of performance be formally evaluated before any new talks begin. They see the WTO as threatening democracy, quality of life, environmental integrity, environmental justice, and every nation's control of its own destiny. Clearly, a titanic clash has begun.

Notes available with original version online.

For information about attending the Seattle protest, phone 877-STOP WTO. Calendars available on the web for Seattle activities: www.seattlewto.org/calendar.html ; www.ictsd.org/html/seattlecalendar.htm ; and, especially, www.seattle99.org (the calendar of all the events planned for Seattle are posted here, you can sign up to volunteer, find housing during the Ministerial, learn more about the WTO and globalization, find great links to organizations)