New version of GATT drawing Nader's fire

July 11, 1994|By Knight-Ridder News Service

WASHINGTON -- Ralph Nader just can't understand it.

He's trudged up to Capitol Hill to testify four times in the last month.

He's telephoned Washington columnists to press his case and made the rounds on the talk-show circuit.

He's tracked down senators and representatives and buttonholed their aides in the halls of Congress.

And still, he is having a tough time getting his message across to the policy-shapers and decision-makers of this city.

Frankly, it is starting to rub him.

"If the American public knew about this, it would be dead in the water. Period," Mr. Nader said, sitting next to a stack of old newspapers and a refrigerator filled with juices in his grungy offices here.

But the mere mention of "it" -- the General Agreement on Tariffs and Trade (GATT) -- is enough to make most people zone out.

GATT is a world trade agreement that sets the terms of commerce between more than 120 nations. As trade agreements go, GATT is dull nuts and bolts: It determines tariff limits for everything from I-beams to shoes.

In December, the world's trading partners accepted a new version of GATT, ending the seven-year Uruguay Round of negotiations. This version, which Congress must now approve, is more ambitious than any other. Instead of just setting tariffs, the new accord also would set up a stronger system for settling trade disputes between countries.

And it is that aspect of GATT that troubles Mr. Nader the most.

Mr. Nader is convinced that the World Trade Organization that will replace GATT will undermine U.S. laws protecting the environment and consumers.

Like GATT, the WTO will mediate everything from disputes over French farm subsidies to challenges of U.S. environmental laws that are viewed as barriers to trade.

But unlike GATT, the WTO will have more arm-twisting power to make its decisions stick.

And if the WTO can chisel away at a U.S. auto emission law here or a dolphin protection law there, Mr. Nader sees his entire life's work at risk.

"Can you imagine what kind of force this tilts against citizens groups?" Mr. Nader asked. "What's at stake is a system of international governance that chills future proposals that we and other citizens groups might make to advance the health, safety and economic rights of consumers."

The Clinton administration dismisses Mr. Nader's arguments and places him on the political fringe with protectionists like conservative columnist Pat Buchanan, who also opposes GATT.

"When you have Pat Buchanan and Ralph Nader on one side, and you've got Bob Dole and Dick Gephardt and Tom Foley and Bob Michel [the Senate and House leaders who support GATT] and many others on the other side, I know where I want to be," U.S. Trade Representative Mickey Kantor said in a talk to the conservative Heritage Foundation.

'Ralph is wrong'

"Ralph is wrong on this issue," Mr. Kantor said. "I think he's misread the Uruguay Round and what we've done here."

Mr. Kantor said that as long as environmental or consumer safety laws can be supported by scientific evidence, they will withstand the scrutiny of any WTO review.

He added that no one, not even the WTO, could force the United States to change its laws. "That's up to the Congress of the United States," he added.

But that misses Mr. Nader's point. His argument is that the WTO will become much more effective at pressuring the United States and other countries to change their ways.

Take the recent GATT dispute over a U.S. law protecting dolphins.

The United States boycotts any tuna caught using fishing methods that also kill dolphins. The European Union objected to the boycott, claiming it was a barrier to trade. On May 20, a GATT dispute panel in Geneva ruled against the United States that the boycott was illegal.

The way the system works now, the United States can ignore the unfavorable decision by not voting for it. And since a decision has to be approved by the unanimous consensus of GATT members, that would effectively block the ruling.

Under the proposed WTO, it will be harder to do that, Mr. Nader said.

A country will not be able to veto a decision by the three-member dispute panel, made up of trade experts. And if it does not comply -- or does not change its domestic law to conform with the world trade agreement -- it would be fined.

In the tuna-dolphin case, the EU is a minor exporter of tuna: Italy exports less than $1 million.

But a far bigger case that is pending, in terms of the economic stakes, involves European car exporters. Led by Mercedes-Benz, they have protested the U.S. standard for fuel economy, known as the Corporate Average Fuel Economy (CAFE) program.

Fines are levied

Under CAFE standards, all automakers are required to maintain an average fuel efficiency for their fleets of 27.5 miles per gallon. If they don't, they're fined.

European carmakers, especially exporters of luxury sedans, say the rules discriminate against them since their higher-priced vehicles tend to be less fuel-efficient. They have filed a complaint with GATT and a ruling is expected soon.

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