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A Citizen's Guide to the World Trade Organization

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A Citizen's Guide to the World Trade Organization A Citizens Guide to THE WORLD TRADE A Citizens Guide to the World Trade ORGANIZATION Organization Published by the Working Group on the WTO / MAI, July 1999 Printed in the U.S. by Inkworks, a worker- owned union shop ISBN 1-58231-000-9 EVERYTHING YOU NEED TO KNOW TO The contents of this pamphlet may be freely reproduced provided that its source FIGHT FOR is acknowledged. FAIR TRADE THE WTO AND this system sidelines environmental rules, health safeguards and labor CORPORATE standards to provide transnational GLOBALIZATION corporations (TNCs) with a cheap supply of labor and natural resources. The WTO also guarantees corporate access to What do the U.S. Cattlemen’s Associa- foreign markets without requiring that tion, Chiquita Banana and the Venezu- TNCs respect countries’ domestic elan oil industry have in common? These priorities. big business interests were able to defeat hard-won national laws ensuring The myth that every nation can grow by food safety, strengthening local econo- exporting more than they import is central mies and protecting the environment by to the neoliberal ideology. Its proponents convincing governments to challenge the seem to forget that in order for one laws at the World Trade Organization country to export an automobile, some (WTO). other country has to import it. Established in 1995, the WTO is a The WTO Hurts U.S. Workers - Steel powerful new global commerce agency, More than 10,000 which transformed the General Agree- high-wage, high-tech ment on Tarriffs and Trade (GATT) into workers in the U.S. an enforceable global commercial code. steel industry lost The WTO is one of the main mecha- their jobs this past nisms of corporate globalization. While year as U.S. factories its proponents say it is based on “free laid off workers in trade,” in fact, the WTO’s 700-plus response to a surge pages of rules set out a comprehensive of imports from system of corporate-managed trade. Japan, Russia, and Indeed, the WTO has little to do with the Brazil. This import 18th Century free trade philosophy surge was caused in developed by David Ricardo or Adam part by the WTOs Smith, who assumed neither labor nor equally problematic capital crossed national borders. cousin organization, the International Under the WTO’s system of corporate- Monetary Fund (IMF), managed trade, economic efficiency, which pushed reflected in short-run corporate profits, countries to increase dominates other values. Decisions their exports to the U.S. as a way to get affecting the economy are to be confined out of the financial crisis caused in part by to the private sector, while social and past IMF policies. The United Steel Workers environmental costs are borne by the of America joined with steel industry public. leaders to ask the President for emergency relief. The President said he would not help Sometimes called the “neoliberal” model, because WTO rules forbid such action. 1 2 A global system of enforceable rules of its current rules before negotiating is being created where corporations new agreements.This booklet explains what the WTO is, how it is damaging have all the rights, governments have the public interest, how corporations all the obligations, and democracy is and some governments want to expand left behind in the dust. WTO’s powers, and what you can do. Now the world’s transnational compa- WHAT IS THE WTO nies want more — a new “Millennium Round” of further WTO negotiations AND HOW DOES IT which would accelerate the economic WORK? race to the bottom by expanding the WTO’s powers. More and more the WTO is under pressure to expand its agenda because more and But this concept’s failure goes beyond more it is seen as the focal point for the this inherent sham: the lose-lose nature many challenges and concerns of of export-led growth was exposed in the globalization. aftermath of the East Asian financial - Renato Ruggiero crisis of 1998. When the IMF compelled WTO Director General Asian countries to try to export their way out of their crises, the U.S. became The WTO is the international organiza- the importer of last resort. U.S. steel- tion charged with enforcing a set of trade workers lost jobs to a flood of steel rules including the General Agreement on imports, while workers in Asia remained Tariffs and Trade (GATT), Trade Related mired in a terrible depression. Intellectual Property Measures (TRIPS), General Agreement on Trade in Services The neoliberal ideological underpinning (GATS), among others. WTO was estab- of corporate-managed trade is pre- lished in 1995 in the ”Uruguay Round”of sented as TINA — “There Is No Alter- GATT negotiations. native” — an inevitable outcome rather than the culmination of a long-term Prior to the Uruguay Round, GATT effort to write and put into place rules rules focused primarily on tariffs and designed to benefit corporations and quotas. Consensus of GATTmembers investors, rather than communities, was required to enforce the rules. The workers and the environment. Uruguay Round expanded GATT rules to cover what is known in trade jargon The top trade officials of every WTO as “non-tariff barriers to trade.” These member country are meeting in Seattle are food safety laws, product stan- at the end of November. If you haven’t dards, rules on use of tax dollars, bought the public relations campaign on investment policy and other domestic TINA and want to help change the laws that impact trade. The WTO’s rules, join your fellow citizens on the rules limit what non-tariff policies Road to Seattle and Beyond. To start countries can implement or maintain. with, the WTO must assess the effects 34 Currently there are 134 member countries THE WTOS RECORD: in the WTO and 33 nations with observer status. Officially, decisions in the WTO THREATS TO are made by voting or consensus. How- DEMOCRACY, HEALTH ever, developed countries, especially the so-called QUAD countries (U.S., Canada, AND THE ENVIRONMENT Japan and the European Union), repeat- edly have made key decisions in closed meetings, excluding other WTO nations. When the WTO was created, con- cerned citizens and public interest The WTO’s lack of democratic process organizations warned that the combina- or accountable decision-making is epito- tion of the WTO’s pro-industry rules and mized by the WTO Dispute Settlement powerful enforcement would pose a Process. The WTO allows countries to threat to laws designed to protect challenge each others’ laws and regula- consumers, workers, and the environ- tions as violations of WTO rules. Cases ment. Almost five years later, there is a are decided by a panel of three trade bu- clear record: the cases settled under reaucrats. There are no conflict of inter- WTO rules show the WTO’s bias est rules and the panelists often have little against the public interest. appreciation of domestic law or of gov- ernment responsibility to protect workers, the environment or human rights. Thus, THE it is not surprising that every single envi- ronmental or public health law challenged CLEAN AIR at WTO has been ruled illegal. CASE WTO tribunals operate in secret. Docu- CASECASE: On behalf of its oil industry, ments, hearings and briefs are confiden- Venezuela challenged a U.S. Clean Air tial. Only national governments are al- Act regulation that required gas lowed to participate, even if a state law is refiners to produce cleaner gas. The being challenged. There are no outside rule used the 1990 actual performance appeals. data of oil refineries required to file with EPA (mostly U.S. refineries) as the Once a final WTO ruling is issued, losing starting point for required improve- countries have a set time to implement ments for refineries without reliable one of only three choices: change their data (mostly foreign). Venezuela law to conform to the WTO requirements, claimed this rule was biased against pay permanent compensation to the win- foreign refiners and took the case to ning country, or face non-negotiated trade the WTO. sanctions. The U.S. official position is that ultimately, laws must be changed to be RESULTRESULT: A WTO panel ruled against consistent with WTO policy. the U.S. law. In 1997, the EPA 56 changed the clean air rules to give should have the right to enact laws that foreign refiners the choice of using an support their choices. Instead, the WTO individual baseline (starting point). The empowers its tribunals to second-guess EPA acknowledged that the change whether health and environmental rules “creates a potential for adverse environ- have a “valid” scientific basis. mental impact.” implication: Refiners from Venezuela The and other countries will use the indi- Shrimp vidual baseline option only if it gives them a weaker starting point, and thus turtle lets them sell dirtier gasoline in the case U.S., which would deteriorate air quality. The WTO gives businesses a CASECASE: Four Asian nations challenged special avenue to challenge policies, provisions of the U.S. Endangered like the Clean Air rules, which have Species Act forbidding the sale in the withstood domestic challenges. U.S. of shrimp caught in ways that kill endangered sea turtles. The Beef RESULT: In 1998, a WTO appellate Hormone panel decided that while the U.S. is Case allowed to protect turtles, the specific way the U.S. tried to do so was not allowed under WTO rules. The U.S. CASE : The U.S. challenged a Euro- government is now considering ways pean Union ban on the sale of beef to change the law to comply with from cattle that have been raised with WTO. certain artificial growth hormones.
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